By maximizing the earnings of the firm we will ensure that the price per share of common stock is maximized,hence shareholders' wealth also will be maximized.

Question

Quizplus · Accepted Answer

Maximizing earnings does not necessarily maximize shareholder wealth, as it does not account for risk, timing of returns, or capital structure, which are also important factors in determining stock prices and shareholder value.

By Maximizing the Earnings of the Firm We Will Ensure