FIN 3101 - Chapter 1 (2) All Answers Correct
What are the 3 financial management decision-making?
1. Capital Budgeting
2. Capital Structure
3. Working Capital Management
Financial Decision Making Examples: Capital Budgeting
deciding whether to expand a manufacturing plant
Financial D...
FIN 3101 - Chapter 1 (2) All Answers Correct
What are the 3 financial management decision-making?
1. Capital Budgeting
2. Capital Structure
3. Working Capital Management
Financial Decision Making Examples: Capital Budgeting
deciding whether to expand a manufacturing plant
Financial Decision Making Examples: Capital Structure
deciding whether to issue new equity and use the proceeds to retire outstanding debt
Financial Decision Making Examples: Working Capital Management
modifying the firm's credit collection policy with its customers
What is Capital Budgeting?
the process of planning, evaluating, comparing, and selecting the long-term operating projects for the
company.
What is Capital Structure?
The means by which a company finances its business activities; for public companies, usually a mix of
bonds (debt) and stocks (equity) sold to investors and owners.
What is Working Capital Management?
The process of managing the day-to-day operating needs of the company through its current assets and
current liabilities.
What question does Capital Budgeting answer?
What business should we be in over the long term?
What question does Capital Structure answer?
Where do we raise the money to conduct our business activities?
What question does Working Capital Management answer?
How will we manage our day-to-day business needs?
What are the 3 Equivalent ways of describing the overriding goals of corporate financial management?
1. Maximize the wealth of shareholders
2. Maximize the price of common stock
3. Maximize the market value of company equity
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller CertifiedGrades. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $10.49. You're not tied to anything after your purchase.
