Asked by Akansh Kumar Arora on Sep 27, 2024
The shareholder value model has reduced corporate reinvestment of cost savings and earnings back into the business and increased corporate repurchasing of company stock to increase share prices.
Shareholder Value Model
A business strategy focused on increasing the returns to shareholders, often prioritizing it above other considerations.
Corporate Reinvestment
The act of a company using its profits to invest back into its own operations, projects, or assets to support growth, improve products or services, and enhance shareholder value.
Company Stock
represents shares of ownership in a corporation, giving holders a claim on part of the company’s assets and earnings.
- Understand the concept and implications of the shareholder value model.
Learning Objectives
- Understand the concept and implications of the shareholder value model.
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