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The market value of the firm is maximized by establishing a brand image or a increasing the brand equity of the firm which is done through advertising or other marketing campaigns and it adds value to the overall worth of a Company in the form of Goodwill and rest of the information can be found from merapakistan.com
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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.
How is a monopoly and a perfectly competitive firm similar?
A perfect competitive market and pure monopoly market both have to follow the "law of demand".
What happens when the cost of capital increases?
The market value of a firm's equity increases, the cost of capital decreases.
What is the golden rule of profit maximization?
To maximize profit or minimize loss, a firm should produce the quantity at which marginal revenue equals marginal cost; this rule holds for all market structures
Explain how monopoly causes an inefficient allocation of resources when the competitive firm does not even when both seek to maximize profits?
Explain how monopoly causes an inefficient allocation of resources when the competitive firm does not even when both seek to maximize profit
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.
The shareholder wealth maximization goal state that management should maximize the percentage value of the future returns to the owners of the firm?
owners of the firm
The primary goal of a publicly-owned firm interested in serving its stockholders should be to?
Maximize shareholder value
Why should the shareholder of a firm care about maximizing a value of a firm?
the value of a firm determines their wealth.if the value of a firm,which is the market price per share of the total number of shares issued,is increased,invariably the shareholders' return is increased..by John I Agwu
What does it mean to maximize the value of a corporation?
there are two version for this, one is called MVA (market value addition) and other is EVA ( economic value addition).
What are the goals of the firm?
To maximize profit.To have low costs.To have profit in the short run and business value in the long run.To get a social function (some firms only).To grow/expand as a firm.
If a firm can maximize its profit by producing output where price is equal to its marginal cost in which type of market is the firm operating?
The firm is operating in Perfect markets. In perfect markets (Perfect competitions), the firm can maximize its profit when its MC is equal with its MR. And in perfect markets, usually the following condition is true: (MR = AR = P). So, in equilibrium which is also the profit maximizing point for a firm, the following condition is a must: MR = AR = P = MC.
If the market value added is positive the market value of the firm's outstanding share of stock a has been created or b has been destroyed or c has had no change or d is in the top performers?
the answer is A. if the market value of the firms investments exceeds the total capital invested in the firm, then sharholder wealth has been created to the extent of the difference.
How is a monopoly and a perfectly competitive firm similar?
A perfect competitive market and pure monopoly market both have to follow the "law of demand".
What services do the company MFS offer?
MFS is a money management and banking firm. They primarily focus on market research and expansion for companies in order to maximize their clients profits.
What does 'Stock holdings ultimately determine the market value of a firm as reflected in prices of the security it issues' mean?
When a firm "floats" it sells stock (share holdings) on a listed stock exchange. People purchase these and they become the owners of the firm and receive a share of the profits that the firm makes each year. If the firm does well then the value of the shares rises on the stock market the shares sell for more than the person originally paid for them. If the firm is badly run it does less well and the value of the shares fall and if the person were to sell their holding, they may get less than they paid for them. Thus the net value of a firm (the total value of all the shares issued) is reflected by the performance (price obtainable) of its shares on the market.
What do you call the market value of a company's assets divided by their replacement costs?
The Q ratio is calculated as the market value of a company divided by the replacement value of the firm's assets Tobin's Q ratio
