American_Bankers_Association
CTFA · Question #186
Which of the following statements is correct regarding profit maximization as the primary goal?
The correct answer is D. Profit maximization is concerned more with maximizing net income than the stock price. See the full explanation below for the reasoning.
Investment Management
Question
Which of the following statements is correct regarding profit maximization as the primary goal?
Options
- AProfit maximization considers the risk level
- BProfit maximization will not lead to increasing short-term profits at the expense of lowering
- CProfit maximization does consider the impact on individual shareholder's EPS
- DProfit maximization is concerned more with maximizing net income than the stock price
How the community answered
(30 responses)- A13% (4)
- B7% (2)
- C3% (1)
- D77% (23)
Topics
#profit maximization#net income#EPS#shareholder goals
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