Mini case II: Retirement Planning
Your 30 year old client wants to retire when he is 65 years old, and have a retirement income equivalent to $5,000 per month in todays dollars.
We cannot be sure of how long we live after retirement, but the client wants
Introduction to Corporate Finance
Multiple Choice Questions
1. Which one of the following terms is defined as the management of a
firm's long-term investments?
A. working capital
C. agency cost
Chapter 4 Financial Ratios
Financial ratios: Information from income statement and balance sheet is used to calculate
financial ratios that measure performance and risk level of a business.
Measuring a companys performance:
- Market value based measure: c
Chapter 5 Time Value of money
What is time value of money?
The same amount of money we invest in is not comparable across periods unless adjusted
for time value
We get compensation (interest) for reducing our current consumption and lending money to
Chapter 3 Accounting and Finance: Financial Statements
Kind of financial statement showing the value of the firms assets and liabilities and
shareholders equity at a particular point in time.
Structure of Balance sheet
Assets= Current asset
Finance Chapter 2
Flow of savings to corporations
Firms need to raise money to support its growth, but where is the money coming from?
- Savings: money that corporations invest in real assets come from savings by domestic
and foreign investors.
Introduction to Corporate Finance (1)
What is a Corporation?
A distinct permanent legal entity owned by shareholders. It discusses limited liability and has
disadvantages in taxation.
Types of business organizations:
- Sole proprietorships