Corporate Finance Vocab

  1. Most Common Goal for Financial Managers
    Maximizing the present value of the expected future returns
  2. Total Shareholder Wealth=
    Number of Shares*Market Price/Share
  3. Present Value
    The value today of all future returns evaluated at a discount rate
  4. Discount Rate
    factors returns from other investments during a specific (future time period)
  5. Stockholders and Creditors (Agency Problem)
    Creditors (Bond holders) have a fixed financial claim on company resources (long run debt) 
  6. Disadvantages of Incorporation
    • Separation of ownership and management
    • Pay taxes at corporate level and on any dividends
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ID
167120
Card Set
Corporate Finance Vocab
Description
Corporate Finance
Updated