The final topic in a series looking at financial management from a theoretical perspective, working capital management provides the focus of the current article. We investigate how three key axioms--the risk-return tradeoff, agency conflicts, and stockholder wealth maximization--relate to this activity that occupies much of the financial manager's…

This series inspects the major topics in finance, reviewing the roles of stockholder wealth maximization, the risk-return tradeoff, and agency conflicts. The current article, devoted to dividend policy, also reviews the topic as presented in textbooks and the literature.

In this series, three key axioms--stockholder wealth maximization, the risk-return tradeoff, and agency conflicts--are applied to the major topics in financial management. The current article looks at mergers and acquisitions, reviewing the presumed motivations, the ethical challenges, and the literature dedicated to this financial activity.

Continuing this series on the theory of financial management, the current article investigates capital structure, offering insight into the roles of stockholder wealth maximization, the risk-return tradeoff, and agency conflicts. Much literature addresses this topic, and some of the most recent literature challenges certain theoretical…