BUSN 110 Chapter Notes - Chapter 9: Corporate Bond, United States Treasury Security, Net Present Value
Document Summary
Chapter 9- finance: acquiring and using funds to maximize value. Financial decisions: financial capital: funds a firm uses to acquire assets and finance its operations. Newly issued stocks or bonds: finance: functional area of business that is concerned with: Uses of financial capital: goal of financial management is to maximize the market price of stock, risk-return tradeoff. Observation that financial opportunities that offer high rates of return are riskier than those offering lower rates of return. Financial ratio analysis: computing ratios that compare values of key accounts listed on financial statements. Liquidity ratios: ability of a firm to obtain the cash it needs to pay short- term debt. Asset management ratios: effectivity of a firm in using its assets to generate revenue. Leverage ratios: extent to which a firm relies on debt financing in its capital structure. Profitability ratios: rate of return a firm earns on various measures of investment.
