1. Explain why market prices are useful to the financial manager. The financial manager is responsible for giving financial advice and support to clients and colleagues that will enable them to make good business decisions. Particular work environments differ considerable and involve both public and private sector organizations such as retailers, corporations, financial institutions, charities, and even small manufacturing companies and schools (Financial Manager, 2011). Primarily, financial managers look at the market price in maximizing the value of the firm. The market value is the present value of the net cash flow divided buy the risk. Investors consider the firm’s future and present earnings, disadvantages or risks and other …show more content…
This gives the researcher or planner a set of values that is useful enough in determining the feasibility of a project from an economic point of view. Generally, it is simple and the results are easy to comprehend. Costs are associated with the company that is commonly much easier to measure and defined compared to benefits. This involves the operating and investment costs. Operating costs involves the materials needed to maintain an operation whilst the investment costs are incurred in planning and design such as the materials, labor, and construction costs. Benefits are, on the other hand, difficult to measure specifically for transport projects. These are diffused and extensive (Slack and Rodrigue, 2011). The relationship of net present value does not reside particularly on the cost-benefit per se rather it is viewed as part of the valuation principle. Net Present Value (NPV) is the difference concerning the present value of the project or the benefits of the investment compared to the present cost values. When the NPV positive for a project or investment opportunity, this means that the project can be implemented. It only means that the firm’s value and the wealth of the investors are increased. In contrast, negative NPV of the investments and projects would mean losing the money of the company if ever the project was implemented. This is in accordance with the NPV decision rule. In investment alternatives, the highest NPV investment alternative should be
The financial manager establishes goals that will help to reach the organizations objectives, then creates steps in which they will use to achieve those goals.
-Martin Industries just paid an annual dividend of $1.30 a share. The market price of the stock is $36.80 and the growth rate is 6.0 percent. What is the firm's cost of equity?
The leading national problem the world is facing today is gun control. In the article “End the gun epidemic in America” by the editorial board of the New York Times. The editorial board stated how politicians are doing nothing to control weapons and ammunition. The article also states how innocent lives have been slaughtered due to this matter; although the article is really brief and is not too specific. The article sends the message that America has to make a change portraying to guns. Although it was not powerful on ethics the argument by the editorial board was equally balanced and worked efficiently with strong logic and emotion.
Life insurance is meant to provide funds to replace a breadwinner's to protect and support dependents. Chad and Haley are dependents, not income providers. Therefore, the purchase of life insurance is unnecessary and not recommended. The Dumonts should use the money they would spend on policies for the children to increase their own coverage.
The financial mangers goal is acquisition, financing, and management of assets. The challenges are investment, financing, and asset management decisions.
Corporate finance is important to all managers because it provides managers the skills needed to identify and select the corporate strategies and individual projects that add value to their firm and forecast the funding requirements of their company and devise strategies for acquiring those funds.
In this paper, I will discuss about the Divine Command Theory and Euthyphro Problem and show how the Euthyphro Problem makes the Divine Command Theory morality arbitrary. Also, I will discuss why one does not have to reject the belief in God due to the Divine Command Theory cannot give a satisfactory answer to the Euthyphro Problem. First, I will define what the Divine Command Theory is and discuss its attractive features that answer the problem about the objectivity of ethnics. Second, I will define the Euthyphro Problem. Also, I will discuss how the Euthyphro Problem makes the Divine Command Theory morality arbitrary and show how it makes the doctrine of God’s goodness meaningless. Finally, I will discuss why one does not have to reject the belief in God just because one rejects the Divine Command Theory.
We are providing below the assumptions and other calculations we used while computing the WACC and the cash flows.
Corporate finance is important to all managers because it allows a manager to be able to predict the funds the company will need for their upcoming projects and think about ways to organize and acquire those funds.
Financial Management: “The process for and the analysis of making financial decisions in the business context.” (Cornett, Adair, & Nofsinger, 2016, p. 5).
In light of recent recoveries from the existing fluid economic crisis, many nations are racing towards achievement of distinctive goals. Resources have been pulled beyond reasonable lengths to ensure economic development is achieved. However, to achieve this global objective, both governmental and private entities must devise resolute policies that will ensure growth is achieved. All this is achieved through application of managerial strategies. This paper will build a discussion around two managerial strategies employed in public administration relative to how it sculpts the rudiments of public service. Various sources shall be used to shed light on these strategies as well as unearth benefits and risks that accompany them.
Finally, in order to complete a more accurate comparison between the two projects, we utilized the EANPV as the deciding factor. Under current accepted financial practice, NPV is generally considered the most accurate method of predicting the performance of a potential project. The duration of the projects is different, one lasts four years and one lasts six years. To account for the variation in time frames for the projects and to further refine our selection we calculated the EANPV to compare performance on a yearly basis.
Finance is the study of applying specific value to things we own, services we use and decisions we make. Financial management is the process for and the analysis of making financial decisions in the business context. The major subareas of finance are investments, financial management, financial institutions, market, and international finance. Risk is a potential future negative impact to value and or cash flow. It is often discussed in terms of probability of loss and the expected magnitude of the loss.
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Financial management is important to the organization because it provides pertinent finance and accounting information to help managers accomplish the purpose of the organization. Financial accounting provides accounting information to external users. On the other hand, managerial accounting is more for managers (internal users) to use for things like planning, budgeting, etc. The definition of finance has changed over the years, but it’s used to ultimately evaluate previous decisions and make assessments for future decisions of the organization.