Question

The goal of a financial manager of a publicly traded corporation should be to: A) Maximize Profits. B) Maximize the wealth of the shareholders. C) Minimize the risk of investing in the firm. D) Maximize Cash Flow from Operating Activities. E) Maximize the salary of the firm’s managers.

Answer 1

B) Maximize the wealth of the shareholders.

Financial managers have a fiduciary responsibility to shareholders to make decisions that maximize the value of their investments in the company.

This typically involves increasing the overall wealth of the shareholders through strategies that enhance the value of the company's stock, such as maximizing profits, cash flow, and long-term financial stability.