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1. In finance theory, the goal of the firm is said to be maximize wealth instead of maximize profit. a. Define shareholder wealth. How would

1. In finance theory, the goal of the firm is said to be "maximize wealth" instead of "maximize profit.

a. Define shareholder wealth. How would one measure shareholder wealth?

b. Briefly discuss two limitations of "profit maximization" as a goal for the firm.

2. What is the economic interpretation of NPV? What is it designed to measure?

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