Which one of the following best states the primary goal of financial management?
A) Maximize current dividends per share
B) Maximize the current value per share
C) Increase cash flow and avoid financial distress
D) Minimize operational costs while maximizing firm efficiency
E) Maintain steady growth while increasing current profits

Question

Quizplus · Accepted Answer

The primary goal of financial management is to maximize the current value per share, which means to increase the wealth of the shareholders by maximizing the value of their investment in the company. The other choices are important goals of financial management, but not the primary one. A) Maximizing current dividends per share is important, but not the primary goal, as it may not lead to an increase in the value of the shares. C) Increasing cash flow and avoiding financial distress is important, but it is not the primary goal, as it may not lead to an increase in the value of the shares. D) Minimizing operational costs while maximizing firm efficiency is important, but it is not the primary goal, as it may not lead to an increase in the value of the shares. E) Maintaining steady growth while increasing current profits is important, but it is not the primary goal, as it may not lead to an increase in the value of the shares.

Which One of the Following Best States the Primary Goal