Exam1_FC - The flashcards are formatted for printing....

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Shareholder Wealth Maximization Timing and Uncertainty of Returns
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The goal of profit maximization ignores: The goal of firms.
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Sole Proprietorship Shareholder Wealth
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Maximizing firm value and stock price is the same as maximizing ____. A business owned by a single individual; owners are entitled to profits, but also losses, so there is no limit on liability.
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Limited Partnership General Partnership
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Two or more owners; each owner is fully responsible for liabilities. Partnership in which one or more partners have limited liability up to the amount of capital invested in the business.
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S-Corporation and LLC Corporation
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A business that functions separate and apart from its owners, who all have limited liability. Provides limited liability, but taxed like a partnership.
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Securities Limited Liability Company (LLC)
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More flexible than an S- corporation. Financial assets that companies sell to raise capital; investors purchase them hoping to earn a high rate of return.
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1. Treasury Bills and Bonds 2. Municipal Bonds 3. Corporate Bonds 4. Preferred Treasury Bills and Treasury Bonds
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Stocks 5. Common Stocks
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The government borrows money in the short-term for ____, but borrows in the long term for ____; safe with a low return. Types of securities from most risk and return to least:
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Private Placement Public Offering
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Securities are made available to all individual and institutional investors. Securities are offered and sold directly to a limited number of investors.
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Secondary Market Primary Market
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Corporation receives money by selling new securities, often to an investment bank. Investors buy and sell existing securities.
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Primary Market Underwriting
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Investment banks accept risk after buying stock from a company. Investment banks provide funds to firms by buying securities from them.
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Money Market Secondary Market
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brokers by buying securities from them. Market for short term
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Exam1_FC - The flashcards are formatted for printing....

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