Question

Financial managers make decisions that: Select one: A. maximise the owners' wealth. B. accord with the...

Financial managers make decisions that:

Select one:

A. maximise the owners' wealth.

B. accord with the owners' decisions.

C. maximise the owners' share values.

D. all of the above.

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Homework Answers

Answer #1

Financial manager make decisions that :-

Answer :-

( D ) All of the above

Explanation :-

A financial manager has to make decisions that maximize the owner's wealth . Wealth maximisation is the main goal of financial management so, a financial manager has to make decision which maximize wealth not only profits .

Wealth maximisation means increase in share value which the owner's hold which will ultimately increase the total wealth of shareholders or owners .

Financial manager are the agents and owners are the principal so, as per agency rule , agent have to work in best interest of their principal so, financial manager must make decisions which accord with the owner's decision so as to avoid conflict of interest .

So, the answer is ( D ) all of the above .

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