What should be the primary operating goal of a publicly owned firm interested in serving its shareholders?
A)maximize the stock price per share, which is the stock's intrinsic value, over the long run
B)maximize the firm's expected EPS
C)maximize the firm's expected total income
D)maximize the stock price on a specific target date

Question

Quizplus · Accepted Answer

The primary operating goal of a publicly owned firm interested in serving its shareholders should be to maximize the stock price per share, which is the stock's intrinsic value, over the long run. This ensures that the shareholders receive the highest return on their investment and the firm is able to attract new investors as well. Maximizing the firm's expected EPS or total income may not necessarily lead to a higher stock price, and maximizing the stock price on a specific target date may not be feasible or sustainable in the long run.

What Should Be the Primary Operating Goal of a Publicly