: BUS-FPX3062_OdomKeely_Assignment1-1

15 views4 pages

keelyodom98

15 Nov 2022

School

Capella University

Department

Finance

Course

BUS-FPX3062

Professor

For unlimited access to Study Guides, a Grade+ subscription is required.

Document Summary

Respond to the following questions using grammatically correct language: martha stewart was accused of insider trading for selling imclone stocks a day before the stock went down in value. The charges of securities fraud were thrown out but she served 5 months in prison for obstruction of justice and lying to investigators. From a financial management point of view, martha stewart"s engagement in insider trading was very unethical. Her acts were incredibly selfish, and she was putting herself before her shareholders. As a ceo, it should have been her responsibility to be ethical and uphold shareholder goals, however instead she did the opposite: explain why wealth maximization is more desirable than profit maximization as a goal for any company. Wealth maximization increases the value of the stock of the company, which increases shareholder"s wealth. Profit maximization increases the capability of earning profits in the short run to help the company grow. Ibm issues 200 million dollars of new common stock.

Related Questions

As we discus social responsibility and ethics, is it possible that certain decisions and actions an conflict with the goal of shareholder wealth maximization? Is there any difference between unethical and illegal behavior?

It has been argued that shareholder wealth maximization is not a realistic norma- tive goal for the firm, given the social responsibility activities that the firm is âexpectedâ to engage in (such as contributing to the arts, education, etc.). Explain why these social responsibility activities are not inconsistent with shareholder wealth maximization.

What is the market price of a share of stock for a firm that pays dividends of $1.20 per share, has a P/E of 14, and a dividend payout ratio of 0.4?

The Market Value Added (MVA) is the ____.

indicator of how successful a firm has been at increasing its financing its assets
return on total capital minus cost of capital
indication of an increase in operating efficiency
positively related to the present value of all expected future EVA.

For our purpose, Shareholders' Value Maximization will be the preferred goal for all of the following reasons EXCEPT:

The shareholders' value maximization goal deals with accounting profit, while the profit maximization goal attempts to make cash available to meet financial needs.
Shareholders' value maximization is a long-run goal and the public image of the corporation may be of deep concern to shareholders including the wealth effect
The effects of all financial decisions are reflected in the price of the stock being traded in efficient markets
The complexities and uncertainties in the external environment are all absorbed in the value of the stock.

salmoncicada724

: BUS-FPX3062_OdomKeely_Assignment1-1

Document Summary

Get access

Related Documents

MGMT 3320 Study Guide - Quiz Guide: Public Company, Stock Issues, Savings Account

ADMS 3660 Lecture Notes - Lecture 5: Drexel Burnham Lambert, Corporate Social Responsibility, Resona Holdings

BUSI 2503 Study Guide - Final Guide: Dividend Tax, Chief Financial Officer, Chief Executive Officer

Related Questions