BFN 110 Lecture Notes - Lecture 19: Tunxis Community College, Cash Management, Inventory Control
6 Jan 2021
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Document Summary
Financial markets are vast global network of corporations, financial institutions, governments and individuals that either need money or have money to lend or invest. Markets for governments to borrow funds for public activities. Higher the risk, the higher the expected return. Goals of financial management: are prepared to pay. Shareholder wealth maximization b/c firm is owned by the shareholders. Goal be measured in terms of market share price (value that investors collectively. Goal of maximizing shareholder wealth may conflict with interests of. Making decisions to max shareholder wealth (measured by market share price) management (compensations) & social/ethical goals. Finance is about making decisions that focus on creating value within the firm and builds upon the disciplines of economics and accounting. Economies provides theories about economic system and decision making. Accounting supplies financial data and data analysis. Finance has evolved from pure descriptive discipline through an analytical, decision-oriented discipline to now a discipline used by financial managers.
