Write a two-page paper on the following prompts:Is the goal of long-term stock price maximization good or bad for society?Do corporations have social responsibility. If so, why, if not, why not?
Is the goal of long-term stock price maximization good or bad for society?
In general, the goal of stock price maximization is good for a society. There are three basic reasons why societies should maximize their stock price.
First, societies are to a large extent the owners of the stock. Most societymembers possess either directly or indirectly a huge stake of the stock market. Maximizing the stock price therefore improves the quality of lives of many ordinary citizens (Dobson, 1999).
It’s also vital to maximize stock prices to benefit the consumers. This is because goods and services should be produced at the lowest possible cost to encourage stock price maximization. Societies must therefore encourage the development of goods and services that consumers want and need. Societies must also generate growth in sales by providing efficient and courteous services to the consumers in order to experience stock price maximization.
The main long-term beneficiaries of are the consumers. This is because in an effort to raise profits and stock prices, societies would increase the prices of their goods and services and gouge the consumers. In a reasonably competitive economy, this would attract completion and eventually lower the prices.
Lastly, stock price maximization can be encouraged for the benefit of the employees. Societies that generally increases their stock prices expand and add more employees. Societies managed with the goal of stock price maximization tend to grow and therefore require more employees (Sang, 2010).
Do corporations have social responsibility. If so, why, if not, why not?
It’s very important for corporations to have social responsibility. According to Beal (2013), corporate social responsibility is the organization’s commitmentto contribute to sustainable economic development, working with employees, the local community and the