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"Shareholder wealth" in a firm is represented by?

 

1) the number of people employed in the firm.

 

2) the book value of the firm's assets less the book value of its liabilities.

 

3) the amount of salary paid to its employees.

 

4) the market price per share of the firm's common stock.

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Question added by Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company
Date Posted: 2015/03/19
Emad Mohammed said abdalla
by Emad Mohammed said abdalla , ERP & IT Software, operation general manager . , AL DOHA Company

>>>>>4) the market price per share of the firm's common stock.

Shareholder wealth is the collective wealth conferred on shareholders through their investment in a company. Members of the board have a fiduciary duty to the shareholders and a responsibility to protect their investment by running the company sensibly and in line with generally accepted practices. Failure to do so can result in penalties, including shareholder votes to remove board members as well as fines and jail time in some cases.

Each shareholder holds a small portion of the company. Issuing more shares will dilute shareholder wealth, while providing dividends to existing shareholders will increase it. The value of the company waxes and wanes over time, causing corresponding rises and falls in shareholder wealth. Investors who purchase stock may take a long position with the goal of profits at a future date, or they may intend to capitalize on their wealth by selling the stocks to another party and making money on the transaction.

Companies can determine shareholder wealth by looking at overall company value in terms of the current value per share and number of stocks issued. Sometimes board members must make strategic decisions that will temporarily reduce shareholder wealth, such as investing in new facilities or technologies. These investments will add value later, and are acceptable to shareholders because they demonstrate a desire to grow the company. Bad business decisions may result in losses with no projected future gain, and can be a cause for concern.

Alex Al Yazouri
by Alex Al Yazouri , General Manager , Al Mushref Cooperative Society

4) the market price per share of the firm's common stock.

Wasi Rahman Sheikh
by Wasi Rahman Sheikh , WAREHOUSE SUPERVISOR , AL MUTLAQ FURNITURE MFG

Option is answer 4)<<<<<<<<<<<<<<<<<

Elke Woofter
by Elke Woofter , Project Assistant , American Technical Associates

Number4) the more shares you have .. the more voting rights ... the more money when the stock is up or is splitting... 

Hany Helmy Haleem
by Hany Helmy Haleem , Director of Warehouses , Nasco Automotive

The answer is num.

4) the market price per share of the firm's common stock.

Best regards

Agreed to specialists

Thanks

Tegegne Abrham
by Tegegne Abrham , General Manager , MM BEDDING INDUSTRIES PLC

I agree with the answe option4 but what about option2? To me It is also a correct answer. Unlisted or non public companies or companies trading in a country where there is no stock market option2 became the appropriate answer. In addition to this in an economy or markwhere the share price is so volatile how could the worth of the company be determined with certainty by taking the market price? Why rating Agencies like Forbs, standard and poor etc consider the net worth of a company limited n their evaluation? I think option B is best answer.

Vinod Jetley
by Vinod Jetley , Assistant General Manager , State Bank of India

I agree to4) market price of common stock

khaled elkholy
by khaled elkholy , HR MANAGER , misk for import & export

agree with all friends ..................................

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