Q1. What are some of the problems involved in implementing the goal of maximizing shareholders wealth? Q2. Firms often involve themselves in projects that do not result directly in profits. For...

Answer 1.
The primary goal of the manager is to maximizing the shareholders wealth; many problems
could be raised during achieving such goals:
One big problem would be agency problems: There could be agency problem with the
maximizing the shareholder funds:
 The agent does a commission on behalf of the main person. This may rise due to
dissimilar skill stages, dissimilar employment locations and positions or limitations on
access.
 The agency problem rises owing to an subject with incentives. An agent might be
interested to act in a way that is not promising for the principal if the manager is
obtainable with an inducement to act in this method. For example, in the sanitation
example, the plumber might make three times as much as cash by endorsing a facility the
agent does not need. An incentive three times the pay is current, and this grounds the...