Question 1 a) Explain the two schools of thought that underpin the relevancy of capital structuring decision.  b) With relevant examples discuss at least three short-term and two long-term financing sources. c) Explain the different considerations for deciding on appropriate capital structure for any given enterprise.

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter13: Capital Structure Concepts
Section: Chapter Questions
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Question 1

a) Explain the two schools of thought that underpin the relevancy of capital structuring decision.  b) With relevant examples discuss at least three short-term and two long-term financing sources. c) Explain the different considerations for deciding on appropriate capital structure for any given enterprise.

Question 2

a) Explain the different dividend payment patterns that can be adopted in an organization.

b) Explain the challenges faced by financial managers whose organization have very inadequate working capital.  

c) Explain the conditions that must be achieved for a relation to be a function and hence show whether the above relation is a function or not.

Question 3 

Explain the following terms as used in Finance for Managers

  1. Discounting
  2. Compounding
  3. Annuities

Question 4

a) Jack deposited $1000 in saving account earning 6% interest rate.

How much will Jack money be worth at the end of 3 years?

b)Jackson needed a $1191 in 3 years to be off some debt. How much should Jackson put in a saving account that earns 6% today?

 

Question 5

Capital Budgeting is a critical issue in the sustainability of any given enterprise globally. Discus this statement using contextual examples.

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