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A survey of Fortune 500 companies' executives said the following goal were most important to their firms: Maximization of the percent return on total asset investment Achievement of a desired growth

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A survey of Fortune 500 companies' executives said the following goal were most important to their firms: Maximization of the percent return on total asset investment
Achievement of a desired growth
Answered Same Day Dec 25, 2021

Solution

Robert answered on Dec 25 2021
125 Votes
Question 1
There are two means for wealth creation for shareholders’ through equity investments namely
through capital appreciation and dividends. With regards to capital appreciation of stock, it is
imperative for the firm to maximise the EPS or earnings per share as price is essentially a
multiple of EPS. In order to generate sustainable growth in EPS, it is imperative for the
usiness to invest in procurement of various business assets and then ensure effective
utilisation of these available assets (Sadler, 2003). Also, as the dollar earnings of the
company are enhanced, the dividends payout in absolute terms would...
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