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प्रश्न
Answer the following question.
State the objective of ' Financial Management '.
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उत्तर
The primary objective of financial management is ‘Wealth maximisation’ which refers to taking those financial decisions that aim at maximizing the shareholders’ wealth. That is, to opt for those financial decisions that prove gainful from the point of view of its shareholders. Herein, the shareholders are said to gain when the market value of the shares held by them rises, which in turn takes place when the benefits from the financial decisions made by the company exceed the cost involved. When the financial decisions successfully fulfill the objective of wealth maximisation, other objectives such as proper utilisation of funds, maintenance of liquidity, maximisation of profits, and meeting financial obligations are automatically fulfilled.
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संबंधित प्रश्न
What is meant by financial management?
Define current assets? Give four examples of such assets.
‘S’ Limited is manufacturing steel at its plant in India. It is enjoying a buoyant demand for its products as economic growth is about 7 to 8 per cent and the demand for steel is growing. It is planning to set up a new steel plant to cash on the increased demand. It is estimated that it will require about `5000 crores to set up and about Rs. 500 crores of working capital to start the new plant.
a. Describe the role and objectives of financial management for this company.
b. Explain the importance of having a financial plan for this company. Give an imaginary plan to support your answer.
c. What are the factors which will affect the capital structure of this company?
d. Keeping in mind that it is a highly capital-intensive sector, what factors will affect the fixed and working capital. Give reasons in support of your answer.
The cheapest source of finance is
For optimal procurement of funds, a finance manager identifies different available sources and compares those items in terms of cost and associated risks. Identify concept highlighted in the above lines.
Financial management is concerned with which combination?
What does financial management enable in relation to funds?
What is the primary objective of financial management?
Efficient financial decisions lead to what?
Shareholders' wealth is reflected in what?
Which examples are Fixed Assets?
What describes Capital Structure?
What does a decision about Procurement of funds address?
What does a decision about Usage of funds address?
What is the aim of a financial decision concerning Cost of capital?
Which items affected by financial management decisions appear in the Profit & Loss Account?
