M3 Discussion.docx - M3 Discussion Making Financial...

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M3 Discussion: Making Financial Decisions What are the linkages among financial decisions, return, risk and stock value? Why are these linkages important? How does the financial manager incorporate these as s/he manages the assets and liabilities of the firm? Similar to last weeks discussion, this topic also centers around a specific cycle of accounting and mathematics in relation to corporate finance. Organizations need direction on which way to lead their business, whether to invest in new technology or partnerships, or helping to resolve debt and loan options. In order to do this, they need to rely on financial decisions, which is the process of making decisions relating to liabilities and equities as well as issuance of bonds. In order to do this, one must calculate risk and return to be able to see if the decision will result in the ability to maximize value of stock. That being said, there is still no guarantee from these numbers that will those choices and

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