Financial managers should strive to maximize the current value per share of the existing stock because:
A) Doing so guarantees the company will grow in size at the maximum possible rate.
B) Doing so increases the salaries of all the employees.
C) They have been hired for the purpose of representing the interest of the current shareholders.
D) Doing so means the firm is growing in size faster than its competitors.
E) The managers often receive shares of stock as part of their compensation.

Question

Quizplus · Accepted Answer

Financial managers are tasked with maximizing shareholder value, which aligns with the interests of the current shareholders. This is a fundamental principle of corporate finance, emphasizing the goal of enhancing the wealth of the firm's owners.

Financial Managers Should Strive to Maximize the Current Value Per