GEB 2011 Lecture Notes - Lecture 1: Financial Statement, Income Statement, Capital Structure
Document Summary
Master budget a presentation of an organization"s operational and financial budgets that represents the firm"s overall plan of action for a specified time period. (presentation over a time period of the firm"s overall plans). Financial capital the funds a firm uses to acquire its assets and finance its operations. Finance the functional area of business that is concerned with finding the best sources and uses of financial capital. Risk the degree of uncertainty regarding the outcome of a decision. Risk-return tradeoff the observation that financial opportunities that offer high rates of return are generally riskier than opportunities that offer lower rates of return. Financial ratio analysis computing ratios that compare values of key accounts listed on a firm"s financial statements. Liquid asset an asset that can quickly be converted into cash with little risk or loss. (will not affect the price of the asset in the market)
