Chapter 1 reiterates the common idea that the goal of the firm is to maximize shareholder...

Question

Chapter 1 reiterates the common idea that the goal of the firm is to maximize shareholder wealth.Discuss why you believe this to be correct or incorrect. Also, discuss the concept of 'stakeholders'. Who are they and how do they impact the debate?

Lekha · Accepted Answer

2
Stakeholders of an organization
STAKEHOLDERS OF AN ORGANIZATION
The goal of the any firm is to maximize shareholder’s wealth. I believe this statement to be correct. 
Any organization work for their shareholders. Hence, the main objective of an organization is to protect the interests of their shareholders as they are the one invested in the company. The performance of the organization directly impacts the shareholders as they are the beneficiaries. Therefore, the existence of an organization revolves around the shareholders. So, a company is always focused on operations which would give fruitful results to the shareholders.
Shareholders review the overall performance of the companies they invest in from time to time. For example,

Chapter 1 reiterates the common idea that the goal of the firm is to maximize shareholder wealth. Discuss why you believe this to be correct or incorrect. Also, discuss the concept of 'stakeholders'....

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