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  3. which of the following statements is false? the sh

Which of the following statements is FALSE? The shareholder wealth maximization objective is that shareholders,...

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Accounting

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Which of the following statements is FALSE? The shareholder wealth maximization objective is that shareholders, who provide equity capital to a firm in return for the residual income or profits, ought to have control because this is the best means for securing their return. Shareholder control also benefits other constituencies automatically, because only residual risk bearers have an incentive to operate the form for maximum profitability and also because their assumption of residual risk ensures the return of all other stakeholder groups O Stakeholder theory maintains that a corporation ought to serve the interests of all those with a stake in the firm, it accepts the economic view that underlies it. The pursuit of shareholder wealth maximization may lead to social costs, such as pollution and urban blight. and also to an unequal distribution of wealth

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