Financial management is all about analyzing their money and investment so as to make investment decisions. It involves a finance manager choosing the sort of capital to obtain in order to fund a company’s assets. Take this second test on MGT 201 financial management and get to review chapter 1 to. All the best!
Profitability Index (PI)
Return on investment (ROI)
Pay back period
Net Present Value (NPV)
Internal Rate of Return (IRR)
Profitability Index (PI)
Internal Rate of Return (IRR)
Net Present Value (NPV)
Profitability Index (PI)
Reduction in the sales revenue, or market share of one product as a result of the introduction of a new product by the same producer.
Reduction in the sales revenue, or market share of one product as a result of the introduction of a new product by the competitor
Increae in the sales revenue, or market share of one product as a result of the introduction of a new product by the same producer
Increase in the sales revenue, or market share of one product as a result of the introduction of a new product by the competitor
TRUE
FALSE
The incremental effect of externalities, whether negative or positive
The incremental effect of externalities while its positive
The incremental effect of externalities while its negitive
No of the above
You have to include the Opportunity costs
You have to ignore the Opportunity costs as in real term it will not produce any inflow or out flow of cash
Discrete Compound Interest:
Nominal rate
Simple Interest
True
False
The risk that the company might goes bankrupt
The risk of default interest payments
Option A & B
None
It is risk associated with interest rate uncertainty
The longer the time to maturity, the higher the premium.
Risk associated that the issuer will not able to pay at maturity
It is linked to life of the investment
Default Risk Premium (DR):
Sovereign Risk Premium (SR)
Maturity Risk Premium (MR)
None
True
False
Short term interest rates are lower than long term
Where the short term raters are higher than long term interest
None
Simple Interest
Discrete Compound Interest
Compound Interest
F V = PV + (PV x i x n)
F V = (PV x i x n)
2500
128.40
1217.93
None
Because it has a direct link with the shareholders dividends maximization
Because it helps in quick judgment regarding the investment in real assets
Because it has direct link with shareholders wealth maximization
Because we have a simple formula to calculate the cash flows
Reduce cost of responding to emergencies by anticipating the future occurrences
Prepare to take advantage of future opportunities
Reduce the uncertainty
Prepare contingency and emergency plans
Cash Budget
Pro Forma Balance Sheet
Pro Forma Income Statement
Pro Froma Cash Flow Statement
Percentage of Sales
Cash Budget
Historical accounts
Option a & b