FINC 3610 Final Exam Prep Newest
Actual Exam With Complete 100
Questions And Correct Detailed Answers
(Verified Answers) |Already Graded A+
4 basic areas of finance - •Corporate finance
•Investments
•Financial institutions
•International finance
Investments - -Works with financial assets such as stocks and bonds
-The Value of financial assets, risk versus return and asset allocation
3 main financial institutions - 1. Banks - commercial and investment, credit unions,
savings and loans
2. Insurance companies
, 3. Brokerage firms
Financial management decisions - 1. Capital budgeting
2. Capital structure
3. Working capital management
capital budgeting - What long-term investments or projects should the business take
on?
capital structure - How should we pay for our assets? Should we use debt or equity?
working capital management - How do we manage the day-to-day finances of the firm?
goal of a firm's financial manager - To maximize the current market value (share price)
of the equity of the firm (whether it's publicly traded or not).
Initial public offerings (IPO)'s are - A primary market transaction.
auction market - NYSE, brokers and agents meet at a physical location (the exchange)
to match buyers and sellers of assets
sole proprietorship advantages - Easiest to start
Least regulated
Single owner keeps all the profits
Taxed once as personal income
sole proprietorship disadvantages - Limited to life of owner
Equity capital limited to owner's personal wealth
Unlimited liability
Difficult to sell ownership interest
partnership advantages - Two or more owners
More capital available
Relatively easy to start
Income taxed once as personal income
partnership disadvantages - Unlimited liability
•General partnership•Limited partnership
Partnership dissolves when one partner dies or wishes to sell
Difficult to transfer ownership
corporation advantages - Limited liability
Unlimited life
Separation of ownership and management
Transfer of ownership is easy
Easier to raise capital
Actual Exam With Complete 100
Questions And Correct Detailed Answers
(Verified Answers) |Already Graded A+
4 basic areas of finance - •Corporate finance
•Investments
•Financial institutions
•International finance
Investments - -Works with financial assets such as stocks and bonds
-The Value of financial assets, risk versus return and asset allocation
3 main financial institutions - 1. Banks - commercial and investment, credit unions,
savings and loans
2. Insurance companies
, 3. Brokerage firms
Financial management decisions - 1. Capital budgeting
2. Capital structure
3. Working capital management
capital budgeting - What long-term investments or projects should the business take
on?
capital structure - How should we pay for our assets? Should we use debt or equity?
working capital management - How do we manage the day-to-day finances of the firm?
goal of a firm's financial manager - To maximize the current market value (share price)
of the equity of the firm (whether it's publicly traded or not).
Initial public offerings (IPO)'s are - A primary market transaction.
auction market - NYSE, brokers and agents meet at a physical location (the exchange)
to match buyers and sellers of assets
sole proprietorship advantages - Easiest to start
Least regulated
Single owner keeps all the profits
Taxed once as personal income
sole proprietorship disadvantages - Limited to life of owner
Equity capital limited to owner's personal wealth
Unlimited liability
Difficult to sell ownership interest
partnership advantages - Two or more owners
More capital available
Relatively easy to start
Income taxed once as personal income
partnership disadvantages - Unlimited liability
•General partnership•Limited partnership
Partnership dissolves when one partner dies or wishes to sell
Difficult to transfer ownership
corporation advantages - Limited liability
Unlimited life
Separation of ownership and management
Transfer of ownership is easy
Easier to raise capital
