Maximizing the earnings of the firm is the main goal of financial management.

Name: Maximizing the earnings of the firm is the main goal of financial management.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The main goal of financial management is to maximize shareholder wealth, which is not necessarily the same as maximizing the earnings of the firm. Maximizing earnings may not always translate into shareholder wealth maximization, as it may not take into account factors such as risk, cost of capital, and the time value of money.

Maximizing the Earnings of the Firm Is the Main Goal