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Homework answers / question archive / What is the principal guiding factor for the financial manager of a firm?
What is the principal guiding factor for the financial manager of a firm?
The predominant driving principle for a corporate financial manager is optimizing the stockholder capital. Wealth maximization can achieve by improving the value of stock in a business that ultimately increases the company value, which in turn maximizes the shareholder wealth. A financial manager act as an agent and its responsibility is to oversee the interests of stockholders.