Which of the Following Is the Overarching Principle That a Financial

question 102

Multiple Choice

Which of the following is the overarching principle that a financial manager should follow when making decisions?

• A)Decisions should generate the greatest benefits for the firm.
• B)Decisions should provide benefit to the firm without incurring costs greater than those benefits to others.
• C)Decisions should be on behalf of the firm's owners that give the greatest benefit to those owners,the firm's employees,and the firm's other stakeholders.
• D)Decisions should increase the value of the firm to its investors.
• E)Decisions should be in the strategic competitive interests of the firm.

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Definitions:

Ordering Merchandise

The process of purchasing goods for sale, typically from suppliers or manufacturers, by a retail or wholesale business.

Spot Rate

The spot rate refers to the current exchange rate at which a currency can be bought or sold for immediate delivery.

Exchange Gain

A profit resulting from holding assets in a foreign currency as the exchange rate fluctuates.

Exchange Loss

A loss resulting from holding foreign currencies that depreciate against the home currency.