Shareholders wealth maximization means maximization the net present value of a course of action to shareholders.
According to Ezra Solomon,” Wealth maximization provide on unambiguous measure or what financial management should seek maximize, in making investment and financing decisions.”
According to I.M. Pandey,” Shareholders wealth maximization means maximization the net present value of a course of action to shareholders. The net present value of a course of action is the difference between the present value of its benefits and the present value of its costs.”
More from this Section
- General average
General average is in ocean marine insurance, a loss incurred for the common good that is shared by all parties to the venture.
Barometer means economic and market data that represent an overall trend. The Dow Jones Industrial Average is an example of a
- Retention of Title Clause
Retention of Title Clause is a contract clause whereby a seller declares his intention to retain title or ownership over the contract goods until
Retention refers risk management technique in which an individual or a firm retains part or all of the losses resulting from a given loss exposure. Used when no other method is available, the worst possible
Boutique is a small, specialized brokerage firm that offers limited services and products
- Advance commitment
Advance commitment is a promise to sell an asset before the seller has lined up purchase of the asset. This seller can offset risk by purchasing a futures contract to fix the sales price
- Aggregate exercise
Aggregate exercise price is the exercise price multiplied by the number of shares in a put or call contract. The option premium