Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Assume you own stock in a company, and you are in the process of selling the stock to another investor. Since the transaction will occur

Assume you own stock in a company, and you are in the process of selling the stock to another investor. Since the transaction will occur between buyer and the seller, the company will receive no direct cash flows as a result of the sale. why should the company's management care about the price you get for your shares if the company does not receive any direct cash flow from the transaction?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essentials of Investments

Authors: Zvi Bodie, Alex Kane, Alan J. Marcus

10th edition

77835425, 978-0077835422

More Books

Students also viewed these Finance questions

Question

Define Management by exception

Answered: 1 week ago

Question

Explain the importance of staffing in business organisations

Answered: 1 week ago

Question

What are the types of forms of communication ?

Answered: 1 week ago