Essay About Financial Manager And Financial Management Team

The Financial Manager and the Firm – Course Note – Hoooma81
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The Financial Manager and the Firm
The Financial Manager and the Firm (Read Moles et al Chapter 1)1. Describe the cash flows between a firm and its stakeholders. What are the three fundamental decisions financial management team is concerned with and how do they affect the firm’s balance sheet?2. Explain what should be the goal of the firm.3. Explain why maximising the current value of the firm’s share price is the appropriate goal for management.4. Why is value maximisation superior to profit maximisation as a goal for the firm?5 In determining the price of a firm’s shares, what are some of the external and internal factors that affect tthe price? What is the difference between these two types of variables?6. Identify the causes of agency costs. What are some ways a company can control these factors?7..  Discuss how agency conflicts affect the goal of maximising shareholder wealth.8. Explain how agency costs might be found within a firm whose CEO owns no shares in the firm and whose compensation package is unaffected by the profits (cash or accounting profits) of the firm.

9.        “The goal of the firm and its financial managers should be the maximisation of shareholder wealth, by which we mean maximisation of the price of the existing common stock”. When stating the goal of the firm, why does finance theory give greater importance to the firm’s shareholders than to its other stakeholders?What are some of the problems involved in the use of profit maximisation as the goal of the firm? How does the goal of maximisation of shareholder wealth deal with those problems?10. Susan George has £100 to invest. She could put it in her bank account, which would pay her interest at the rate of 6% per year. But Susan wants to invest the amount so as to get the maximum profit possible. She has found an investment that would give her back a total amount of £108 after one year, i.e. a profit of £8. But, since she wants to maximise the profit, she is attracted by another equally safe investment that would give her back a bigger sum of £132 at the end of five years – i.e. 4 times the profit that the one-year investment would give.

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“The Financial Manager and the Firm” EssaysForStudent.com. 01 2016. 2016. 01 2016 < "The Financial Manager and the Firm." EssaysForStudent.com. EssaysForStudent.com, 01 2016. Web. 01 2016. < "The Financial Manager and the Firm." EssaysForStudent.com. 01, 2016. Accessed 01, 2016. Essay Preview By: Hoooma81 Submitted: January 18, 2016 Essay Length: 469 Words / 2 Pages Paper type: Course Note Views: 693 Report this essay Tweet Related Essays Financial Manager Career Data Analysis As the economy expands and employment opportunities increase, the need for workers with financial expertise will go up. I will enter the workforce at an 588 Words  |  3 Pages Role of the Financial Manager Role of the Financial Manager Paper Introduction Shareholders own companies and are therefore entitled to a return on their investments when the companies are performing 1,039 Words  |  5 Pages Financial Management What do you understand by the phrase “stakeholder analysis”? Attempt a stakeholder analysis of an organisation that you are closely associated with. Introduction Stakeholder analysis 464 Words  |  2 Pages Financial Manager’s Role In a management atmosphere characterized by a multitude of complicated financial challenges, today's chief financial officers (CFOs) must perform many vital roles. They effectively 648 Words  |  3 Pages Similar Topics Financial Management Personal Financial Management Get Access to 89,000+ Essays and Term Papers Join 209,000+ Other Students High Quality Essays and Documents Sign up © 2008–2020 EssaysForStudent.comFree Essays, Book Reports, Term Papers and Research Papers Essays Sign up Sign in Contact us Site Map Privacy Policy Terms of Service Facebook Twitter