The primary goal of ﬁnancial management is to maximize the:
A) Growth rate of a ﬁrm.
B) Compensation of the corporate oﬃcers.
C) Current value of each share of outstanding stock.
D) Number of shares of common stock outstanding.
E) Book value of the ﬁrm.

Question

Quizplus · Accepted Answer

The primary goal of financial management is to maximize the current value of each share of outstanding stock. This is achieved by making investment decisions, financing decisions, and dividend decisions that increase the value of the company's stock. Maximizing the growth rate of the firm, compensation of corporate officers, number of shares outstanding, or book value of the firm can all be secondary goals, but they should ultimately serve the primary goal of maximizing shareholder value.

The Primary Goal of ﬁNancial Management Is to Maximize The