Chapter 1 questions.docx - Vladimir Burnusuz Chapter 1 Questions 1 A firm’s intrinsic value is an estimate of the firm’s stock true value based on

Chapter 1 questions.docx - Vladimir Burnusuz Chapter 1...

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Vladimir Burnusuz Chapter 1 Questions 9-13-2019 1. A firm’s intrinsic value is an estimate of the firm’s stock true value based on accurate risk and return data. The stock’s true long run value is more related to its intrinsic value because its current price fluctuates constantly whereas its intrinsic value is more of a firm number and is less likely to change as often as its current price. 7. The maximization of stockholders wealth is almost always a long-term goal the ultimate goal is to raise your stock price as high as possible not as fast as possible for example one of the biggest corporations in the world Amazon is a great example of how there trying to maximize
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Unformatted text preview: stockholder wealth in the future because of the amount of time and resources they are putting into AWS even though its not there main source of income but they do believe that it is there future and eventually one day be there main source of income 9. SSC primary goal is to maximize stock holders equity even though they are spending millions in what seems to be ways that will not increase the stock price but all three of these big announcement of SSC expenditures is expenses that were justified because all three will maximize there common stock holders wealth within the future although immediately there stock will not go up it will eventually raise...
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  • Spring '14
  • ChristinE.Cleaton-Ruiz

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