Goal of shareholder wealth maximization

Assignment Help Finance Basics
Reference no: EM131624823

Do you believe that the firm's social responsibilities conflict with the ultimate goal of shareholder's wealth maximization? Consider issues such as the protection of the environment and the creation of jobs.

As we discuss social responsibility and ethics this week, is it possible that certain decisions and actions can conflict with the goal of shareholder wealth maximization?

In finance, what would we call this conflict?

Ethics

It's easy for us to study ethics and often play "arm chair quarterback" after an issue has become public. Put yourself in this situation... You determine that your boss's boss (let's call him Steve the Vice President) is building false documents to help the company get a loan. You follow the chain of command and talk to your boss who simply tells you to stick to your job and not Steve's. What do you do next? Remember unemployment is still running around 7.0% or so and your youngest child needs braces. Umm... come to think of it your other children need school clothes, supplies and the entire family likes to eat. Your job also pays well above average.

If you were the HR manager, what would you do if someone came to you with this issue?

Reference no: EM131624823

Questions Cloud

Who audited the financial statements in the cafr : Internet Exercise: Governmental Audit Reports. Go to the website of the town where you reside and find the Comprehensive Annual Financial Report (CAFR).
Analyze the ethical considerations : Analyze the ethical considerations, as well as the benefits and limitations of the research proposing solutions or suggestions for any issues or concerns.
Identify the amount and timing of all cash flows : Identify the amount and timing of all cash flows related to the acquisition of the new equipment
Should the company eliminate or keep the segment : Should the company eliminate or keep the segment - Eliminate the segment since unavoidable expenses - Eliminate the segment since the contribution margin
Goal of shareholder wealth maximization : Do you believe that the firm's social responsibilities conflict with the ultimate goal of shareholder's wealth maximization?
What audit evidence would look for performing quality audit : Quality Control Audit of a University. In a quality audit, defining the measurement criteria is often difficult and time consuming.
International financial firm : Determine the most significant factor that an international financial firm should consider when choosing an appropriate merger partner.
Prepare a bank reconciliation at march : Bell Food Store developed the following information in recording its bank statement for the month of March. Prepare a bank reconciliation at March 31
What is the total manufacturing overhead cost : What is the total manufacturing overhead cost using a flexible budget - The company had 90,000 direct labor hours.

Reviews

Write a Review

Finance Basics Questions & Answers

  What is the pretax cost of debt

Shanken Corp. issued a 10-year, 8 percent semiannual bond 3 years ago. The bond currently sells for 96 percent of its face value.

  What is the current share price

Bui Corp. pays a constant $13.40 dividend on its stock. The company will maintain this dividend for the next six years and will then cease paying dividends forever.

  Find that average growth factor

The average growth factor for money compounded at annual interest rates of 17%, 37%, 14%, and 22% can be found by computing the geometric mean.

  Explain why verizon has always had higher debt

Please describe the internet statement "Verizon has always had higher debt than some of its peers. There was some discussion about this inside the industry few years ago when they were deploying their IPTV services (FiOS).

  What type of option does the investor in this bond have

If a bond is putable, what type of option does the investor in this bond have? Suppose a bond has a market price of $90 and has five years remaining to maturity. If the bond is priced to yield 5%, is its coupon rate greater than, less than, or eq..

  Capital gains and dividend tax treatment extended to 2010

The Jobs and Growth Tax Relief Reconciliation Act of 2003 changed the tax treatment of corporate dividends for most taxpayers. The result is noticeably higher dividend payouts by corporations today than prior to the passage of the 2003 legisla..

  What effect will a two-for-one stock split have

What effect will a two-for-one stock split have on the following items found on a firm's financial statements?

  Changes in the forward rate assume that interest rate

changes in the forward rate assume that interest rate parity exists and will continue to exist. as of this morning the

  Complete a financial analysis of longs jewelers

Complete a financial analysis of Longs Jewelers including a cash flow statement and ratio analysis and discuss your findings. Identify critical non-quantitative issues that should be considered in the decision process

  Should remp lease the trucks

Leasing Limited has a 40% tax rate, while Remp has a 20% tax rate. Treat this as a guideline lease. Should Remp lease the trucks (explain)?

  This year ted received a 600 refund of state income tax

this year ted received a 600 refund of state income tax. ted could have deducted 1100 of state income tax on the prior

  Determining the long-term debt

The company's net fixed assets were $40,331, and other assets were $1,822.  GenX had accounts payable of $10,604, notes payable of $2,886, common stock of $22,400, and retained earnings of $14,368. How much long-term debt did the firm have?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd