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What managerial actions can influence the value of the firm in the context of the shareholders wealth maximization model?
The risk and return trade-off or the attitude of management towards risk will play a major role in determining the value of a firm. This for example will form a basis of whether to invest in government bonds where the risk of default is low and return equally expected will be low, this is the opposite of a decision to invest in shares where the risk is high but the expected return can equally be high. In terms of SWM, the value of the firm will be reflected in the market value of a company's shares.
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How can government actions or policies influence aggregate demand?
Government actions can control or influence the aggregate demand of its country by controlling pricing. Aggregates are the total amounts of goods that a country purchases for various things.
What are the difference between managerial functions and managerial roles?
First/ The Basic four Managerial functions are1- Planning Setting performance objectives and deciding how to acheive them.2- Organizing Arranging tasks, people and other resources to acomplish the work.3- Leading Inspiring people to work had to acheive high performance.4- Controlling Measurin performance and taking actions to ensure desired results.Second/ The managerial roles according to mintzberg areInterpersonal roles Informantional roles Decisional roles1- Figurehead. 1- Monitor. 1- Entrepreneur.2- Leader. 2- Disseminator. 2- Disturbance handler.3- Liaison. 3- Spokesperson. 3- Resource allocator.4- Negotiator.
What actions can the government exercise to influence economic activity?
The government can influence the economic activity by increasing the amount of money in the economy. Some example have been stimulus checks and amended tax rates, that have happened in the past.
How does system approach affect managerial practice?
The systems approach affects managerial practice by emphasizing the interconnectedness of various organizational components, encouraging managers to view their organization as a complex system rather than in isolation. This perspective fosters holistic decision-making, as managers consider the broader implications of their actions on different departments and stakeholders. Additionally, it encourages collaboration and communication across functions, leading to more effective problem-solving and innovation. Ultimately, this approach enhances adaptability and resilience in a dynamic business environment.
What is business influence?
Business influence refers to the ability of a firm or organization to influence decisions, actions, and outcomes in its environment. This effect can manifest itself in several ways: Market Influence: The ability of a company to influence market trends, consumer behavior, and the competitive landscape. This could be through innovation, pricing strategies, or brand reputation. Legislative Influence: The ability of a business to apply policies and legislation. This may include lobbying efforts, contributions to political campaigns, or joining legislative business groups. Social Impact: How a business influences society’s norms, values, and behaviors. This could be corporate social responsibility (CSR) initiatives, sustainability efforts, or influence through advertising and media. Economic Impact: The impact of a company on the economy, including job creation, economic growth, and its role in the supply chain. Large projects can affect economic conditions locally, nationally, or even globally. Cultural Influence: The ability of a business to shape culture, whether through its products, services, or company characteristics. Technology companies, for example, have had a profound impact on today’s communication and work culture. Internal Impact: The impact a business has on its employees, shareholders, and stakeholders. This includes leadership styles, corporate governance, and decision-making processes that shape company dynamics. Specifically, performance impact relates to the ability and extent to which a firm can shape its environment, both internally and externally.
In the context of the shareholder wealth maximization model discuss the managerial actions that can influence the value of the firm?
Managerial actions that can influence the value of the firm include preserving the reputation of the firm by being ethical and responsible. Also, they need to invest in providing quality services and products that will keep the firm competitive.
What statement about corporations is not true?
their shareholders are responsible for the corporation's actions and debts Their shareholders are responsible for the corporation's actions and debts Their shareholders are responsible for the corporation's actions and debts kking kkilla Their shareholders are responsible for the corporation's actions and debts Their shareholders are responsible for the corporation's actions and debts Their shareholders are responsible for the corporation's actions and debts
What are the significance of managerial ethics?
Managerial ethics, thus, is the code of moral managerial conduct that raises questions about the "goodness" or "badness" of managerial actions, motives and objectives.
How are managers bonded to shareholders?
1. Shareholders determine the membership of the board of directors by voting. 2. Contracts with management and arrangements for compensation can be made so that management has an incentive to pursue shareholders' goals. 3. Fear of a takeover gives managers an incentive to take actions that will maximize stock prices 4. Competition in the managerial labour market may force managers to perform in the best interest of shareholders. Firm willing to pay the most will lure good managers.
What are some actions an entrenched management might take that would harm shareholders?
REFERENCE:Brigham and Ehrhardt (2009) Financial Management Theory andPractice (13th Ed) 13.4 Managerial Behavior and Shareholder Wealth, page 531 (Retrieved onJuly 23, 2011)
Which statement about corporations is not true?
Their shareholders are responsible for the corporation's actions and debts.
What are the mechanisms to ensure that managers act in the best interest of the shareholders?
To ensure that managers act in the best interest of shareholders, companies often implement performance-based compensation schemes, such as stock options or bonuses tied to financial metrics. Additionally, corporate governance structures, including a strong board of directors and independent audit committees, help oversee managerial decisions and hold them accountable. Shareholder activism, where investors voice their concerns or push for changes, also serves as a mechanism to align managerial actions with shareholder interests. Lastly, regular financial reporting and transparency promote accountability and enable shareholders to monitor management performance.
If shareholders are dissatisfied what action can they take?
The simplest thing shareholders can do is sell their shares. This is called voting with your feet or voting with your money. Shareholders can also petition to have items placed on the annual shareholder ballot. Shareholders can group together to vote out ineffective board members, though there are limits on how they can cooperate.
Who can attend annual meetings?
Usually shareholders in publicly listed companies are invited to attend annual meetings. At the meeting shareholders are invited to ask questions to the board of directors in regards to the companies past and predicted performances. Shareholders also vote on reelecting board members and also on other actions relating to the company.
What does the term "piercing the corporate veil" mean and how does it impact the liability of individual shareholders in a company?
"Piercing the corporate veil" refers to a legal concept where courts hold individual shareholders personally liable for the debts or actions of a corporation. This typically happens when the corporate structure is abused or disregarded, leading to the shareholders' protection being removed. As a result, shareholders may be required to cover the company's liabilities with their personal assets.
How did religion influence Martin Luther King's actions?
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Propaganda?
Intensive use of mass media to spread political ideas
