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What type of corporation would be a shareholder wealth maximizer?
Wiki User
∙ 9y ago
A closely held corporation would be a shareholder wealth maximizer because owners are invested in their company. They may make decisions that increase their profits.
Wiki User
∙ 9y ago
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Does shareholder wealth maximization benefit society as a whole?
Of course yes, if organization assum objectives of shareholders wealth maximization, it will struggle for profit maximization which will lead to more operations. operations of business needs employees, which will be hired from the society and the unemployment rate will decreased, on the other hand the organization will survive in long run and would meet the demands of the society as whole.... Haleem Graduate school of business University of gothenburg Sweden
Is there a difference between corporate profit maximization and maximization of shareholder wealth?
Sure, profit maximization relates to profits *only* while shareholder wealth also involves total company equity, debt ratios and any of 15 other financial performance measure ratios. Management could focus on profit maximization over a longer period of time, say, 40 years (Toyota), while the shareholder would rather see stock values and corporate total value increase immediately (get in and get out) (90% of American manufacturers). If management focused on short-term profit maximization, say at the expense of long term sales revenues, then shareholder wealth (stock price) could actually decrease as a result of the loss of market share. The conflict of interests between shareholders and executives is an example of the "principle-agent problem."
When a firm is maximizing profit what else will it maximize?
When a firm maximizes its profit, it automatically maximizes its shareholder value. When both profit and the shareholder value increase, in course of time, the overall firm value will increase. All these would undoubtely increase its share price in the market as well.
What would be songhai source of wealth?
Put your trust in NOBODY!
Where there is no wealth there is no poverty?
if no one was wealthy we would all be in poverty but you could also look at it like where there is no good there is no evil
Would management pursue goals other than shareholder wealth maximization?
Of course yes, but maximizing shareholder wealth would be the primary goal of any organization that has shareholders.
If all companies had an objective of maximizing shareholder wealth would people overall tend to be better or worse off?
If all companies had an objective of maximizing shareholder wealth would people overall tend to be better or worse off?
In forming a Sub S corporation if the shareholder contributes a piece of equipment to the corporation what is its basis in the corporation?
The equipment would become a fixed asset of the corporation.
How can we maximize the shareholder wealth in banking sector?
There are several ways to maximize the shareholder wealth in banking sector. This would entail encouraging more clients to transact with the bank which will generate more income for the banks and thereby maximizing the wealth of shareholders.
Can a shareholder sue a corporation?
No. A stockholder would need to convince the board of directors to vote to take such an action as a corporation. On the other hand, a number of shareholders can sue the board of directors for not taking prudent steps to protect the business and assets of the company.
Maximizing shareholder wealth means maximizing the firms what?
when companies maximized shareholder stocks, it only shows that the company is in progress and supports a positive environment to people/employees who works in finance,marketing,production administration.Shareholder wealth is the market value of the firm's common stock. Shareholder wealth is calculated as the number of common shares outstanding times the market price per share (the price at which the firm's common stock trades for in the marketplace such as the New York Stock Exchange).The goal of shareholder wealth maximization is a long-term goal. Shareholder wealth is a function of all the future returns to the shareholders. Hence, in making decisions that maximize shareholder wealth, management must consider the long-run impact on the firm and not just focus on short-run (i.e., current period) effects. For example, a firm could increase short-run earnings and dividends by eliminating all research and development expenditures. However, this decision would reduce long-run earnings and dividends, and hence shareholder wealth, because the firm would be unable to develop new products to produce and sell.
Does shareholder wealth maximization benefit society as a whole?
Of course yes, if organization assum objectives of shareholders wealth maximization, it will struggle for profit maximization which will lead to more operations. operations of business needs employees, which will be hired from the society and the unemployment rate will decreased, on the other hand the organization will survive in long run and would meet the demands of the society as whole.... Haleem Graduate school of business University of gothenburg Sweden
Can you be my own trustee or my corporation?
Another asker who can't control his pronouns. Why would I want to be trustee of your corporation or of you? Corporations do not have trustees. If the corporation files for bankruptcy protection, you cannot be the trustee. Similarly, you cannot be your corporation. A corporation is a separate legal entity. You may be the only officer and shareholder, which can cause you some tax and liability problems, but you are not the corporation.
How do I account for inventory that comes directly from a Shareholder - I have set up a shareholder inventory account but do not know what the other side of the entry should be. This is a corporation?
When inventory is contributed by a shareholder, you should credit the shareholder inventory account to reflect the increase. The other side of the entry depends on whether the shareholder is purchasing the inventory or contributing it as a capital contribution. If the shareholder is purchasing the inventory, you would debit the cash or accounts payable account. If it is a capital contribution, you would debit the shareholder equity account, specifically the common stock or additional paid-in capital account.
What is the difference between shareholder's wealth maximization and shareholder's profit maximization?
Wealth is the accumulation of profit so it might seem that the two are maximized in the same way. But there are differences. Some examples:- Profit may be taxed. So wealth is maximized by maximizing the net of profit minus tax impacts which may occur in the future.- Increased value of an investment would add to wealth but would not show up as profit until the investment is sold.-Wealth may be obtained in ways other than profit. Receiving a gift or buying something for less than its real value may add to wealth but are not profit.-Stock buy-backs by a company produce no profit but increase stockholder wealth by driving up the value per share held.
Can a shareholder sue his or her corporation to enforce preemptive rights?
The corporate charter giving preemptive rights can be enforced in court, if necessary, and a corporation would normally try to avoid having to defend such an action at a delicate time, i.e., while wooing new investors.
Can you buy shares in a close corporation?
Yes, you can buy shares in a close corporation. However, it may be subject to restrictions outlined in the corporation's shareholder agreement or bylaws. Close corporations typically have a limited number of shareholders and shareholders often have first right of refusal on share transfers.
