FIN 300 Chapter 4: Chapter 4.docx

• School: Ryerson University
• Department: Finance
• Course: FIN 300
• Professor: Michael Inglis

Document Summary

Chapter 4: long term financial planning and corporate growth. Way financial goals are achieved, what to be done in future. Growth by itself is not an appropriate goal for financial manager. Rapid growth isn"t always good for a fimr prices rise, costs, sold below cost. Appropriate goal is increasing the mkt val of the owners" equity growth usually results. Growth as growth in mkt val of equity in the firm, then goals of growth and increasing the mkt val of. Consequence of good decision making equity not diff. Inputs in form of alt sets of assumptions: a worse case pessimistic assumptions of company"s products and state of ecn. What can planning accomplish? basis for financial plan. Examining interactions: where $/ financing obtained to pay for activity --> expansion. Exploring options: develop, analyze, and compare diff scenarios in consistent way impact on firms" sh firm"s future lines of bus/ financing options. Avoiding surprises: assumptions made today about future contingency plans.