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What does take a firm private mean?
By taking a firm private, management or a group of stockholders obtain all the firm's stock for themselves by buying it back from the other stockholders. An example would be a leveraged buyout.
Who faces limited liability for the firm's debts in a corporation?
indiviual stockholders
The residual income of the firm belongs to?
residual income belongs to the common stockholders.
The primary goal of a publicly-owned firm interested in serving its stockholders should be to?
Maximize shareholder value
Why does a prospective stockholders of a firm interested in a firms financial statement?
Prospective stockholders are interested in a firm's financial statements because these documents provide critical insights into the company's financial health, profitability, and operational efficiency. By analyzing income statements, balance sheets, and cash flow statements, investors can assess the firm's performance, understand its revenue sources, and evaluate its ability to generate returns on their investment. Additionally, these statements help stockholders identify potential risks and make informed decisions about whether to buy, hold, or sell shares. Overall, financial statements are essential for evaluating the viability and future growth prospects of the firm.
If stockholders or management tries to obtain all the stock of a firm for themselves what is this referred to?
When stockholders or management attempt to acquire all the shares of a firm for themselves, it is referred to as a "buyout." This can take the form of a "management buyout" (MBO) when the company's management is involved, or a "leveraged buyout" (LBO) when external financing is used to purchase the company. The goal is often to gain full control over the firm, potentially to implement changes in strategy or operations.
A decrease in a firm's willingness to pay dividends is likely to result from an increase in its what?
A decrease in a firm's willingness to pay dividends is likely to result from an increase in its profitable investment opportunities. A dividend is a payment made by a corporation to its stockholders. It is a usually a distribution of profit.
When do preferred stockholders receive dividends in relation to common stockholders?
Preferred stockholders typically receive dividends before common stockholders.
Preferred stockholders take less risk than common stockholders?
Preferred stockholders take more risk than common stockholders.
Which tense is correct Majority of stockholders was present or majority of stockholders were present?
The majority of stockholders were present.
Why is profit part of a firm's objective?
Profit is what is left over from a business after the bills are paid. without profit the company can not afford to re-invest in capital or have money to pay stockholders
What is the difference between preferred and common stockholders?
Preferred stockholders have a greater claim on the assets and profits of a company compared to common stockholders. If a company is liquidated, preferred stockholders have to be paid first before the common stockholders.
