A Typical Company Has Many Types of Shareholders, from Individuals

question 17

Multiple Choice

A typical company has many types of shareholders, from individuals holding a few shares, to large institutions that hold very large numbers of shares. How does a financial manager ensure that the priorities and concerns of such disparate stockholders are met?

• A) The financial manager should seek to make investments that do not harm the interests of the stockholders.
• B) The decisions taken by the financial manager should be solely influenced by the benefit to the company since, by maximizing its fitness, he or she will also maximize the benefits of that company to the shareholders.
• C) The financial manager should consider the interests and concerns of large shareholders a priority so the needs of those who hold a controlling interest in the company are met.
• D) In general, all shareholders will agree that they are better off if the financial manager works to maximize the value of their investment.

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Definitions:

Unobtrusive Measures Research

Research methods that do not involve direct interaction with the participants, allowing observation without influencing behavior.

Qualitative Research

Research that explores and understands phenomena through the collection and analysis of non-numerical data.

Reliability

The degree to which an assessment tool produces stable and consistent results over multiple administrations.

Qualitative Researchers

Researchers who employ methods aimed at gathering in-depth understanding of human behavior and the reasons that govern such behavior, focusing on the "why" and "how" of decision making.