Fundamentals of Corporate Finance

Fundamentals of Corporate Finance - Chapter 1 The...

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COPYRIGHT©ZHULI 1 Chapter 1 The Corporation and the Financial Manager
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COPYRIGHT©ZHULI 2 Objectives 1. Give examples of the investment and financing decisions that financial managers make, and explain the responsibilities of the CFO, treasurer, and controller 2. Cite some of the advantages and disadvantages of organizing a business as a corporation 3. Explain why maximizing market value is the logical financial goal for the corporation 4. Understand why conflicts of interest arise, especially in large, public corporations 5. Explain how corporations mitigate conflicts and encourage ethical, cooperative behavior
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COPYRIGHT©ZHULI 3 Content Investment and financing decisions What is a corporation? Who is the financial manager? Goals of the corporation
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COPYRIGHT©ZHULI 4 Making good investment and financing decisions is the chief task of the financial manager.
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COPYRIGHT©ZHULI 5 The Investment Decision Investment decision /capital budgeting decision : decision to invest in tangible or intangible assets If a project’s value is greater than its required investment, then the project if attractive financially Investments in automobile plant Investments in research and development (R&D)
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COPYRIGHT©ZHULI 6 The Financing Decision Financing decision
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Fundamentals of Corporate Finance - Chapter 1 The...

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