The primary operating goal of a publicly-owned firm interested in serving its stockholders should be to a. Maximize the stock price per share over the long run, which is the stock's intrinsic value. b. Maximize the firm's expected EPS. c. Minimize the chances of losses.

Question

Dahlia Howell

Business

5 February, 11:13

The primary operating goal of a publicly-owned firm interested in serving its stockholders should be to a. Maximize the stock price per share over the long run, which is the stock's intrinsic value. b. Maximize the firm's expected EPS. c. Minimize the chances of losses.

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Rafael Miranda · Answer 1

Option b. Maximize the firm's expected EPS

Explanation:

When you maximize the EPS of a company you are getting the best operating results (EBIT) each year, it means you keep your cost at low level and maximize you Profit Margin, this way you are getting the best result to your shareholders as long as you keep your debt ratio at low level.