Fisher Separation Theorem

Fisher Separation Theorem

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Please note that the content of this book primarily consists of articles available from Wikipedia or other free sources online. In economics, the Fisher separation theorem asserts that the objective of a corporation will be the maximization of its present value, regardless of the preferences of its owners. The theorem therefore separates management's "productive opportunities" from the entrepreneur's "market opportunities." It was proposed by - and is named after - the economist Irving Fisher. Fisher showed the above as follows: 1 The firm can make the investment decision - i.e. the choice between productive opportunities - that maximizes its present value, independent of its owner's investment preferences. 2 The firm can then ensure that the owner achieves his optimal position in terms of "market opportunities" by funding its investment either with borrowed funds, or internally as appropriate.show more

Product details

  • Paperback | 88 pages
  • 152 x 229 x 5mm | 141g
  • Loc Publishing
  • United States
  • English
  • 6136691019
  • 9786136691015