The value of the firm is best measured by... a. the present value of expected earnings...
The value of the firm is best measured by...
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a. |
the present value of expected earnings discounted back at a rate the reflects both the riskiness of the firms projects and the financing mix used to fund those projects. |
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b. |
the future value of expected earnings discounted back at a rate that reflects both the riskiness of the firms projects and financing mix used to fund those projects. |
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c. |
the present value of expected cash flows discounted back at a rate the reflects both the riskiness of the firms projects and the financing mix used to fund those projects. |
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d. |
the future value of expected cash flows discounted back at a rate that reflects both the riskiness of the firms projects and financing mix used to fund those projects. |
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Which of the following is not a potential problem associated with the formation of industrial groups in Japan and Germany?
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a. |
Conflicts of interest between firms. |
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b. |
Less risk taking. |
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c. |
Increased risk taking. |
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d. |
Contagion effects within the group. |
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Which of the following is the primary goal of a financial manager?
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Homework Answers
1st question:
d.the future value of expected cash flows discounted back at a rate that reflects both the riskiness of the firms projects and financing mix used to fund those projects.
The value of the firm can be measured by discounting the future expected cash flows with the cost of capital of the concern.
2nd question:
b.less risk taking.
taking lower risks will not be a potential problem where as conflict of interest increased risk taking, contagion effects would be potential problems.
3rd question:
b.increase the value of the firm.
the primary goal of a financial manager would be to increase the value of the firm, rather than decreasing the fixed costs,
increasing EPS or profit margin do not attain primary goal status.
Add Answer to:
The value of the firm is best measured by...
a.
the present value of expected earnings...
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