Financial Management

王南

目录

  • 1 Chapter1  An Overview of  Financial Management
    • 1.1 Unit 1  Financial Management Decision
    • 1.2 Unit 2  Types of Business Organization
    • 1.3 Unit 3  Objectives of Financial Management
    • 1.4 Unit 4  Agency Relationships
    • 1.5 Unit 5  Corporate Structure of the Company
  • 2 Chapter 2 Financial Statement Analysis
    • 2.1 Unit 1 Financial Statements
    • 2.2 Unit 2  Financial Ratio Analysis
    • 2.3 Unit 3 Common-Size Analysis
    • 2.4 Unit 4  Index Analysis
  • 3 Chapter 3 Time Value of Money
    • 3.1 Unit 1  The Interest Rate
    • 3.2 Unit 2  Simple Interest
    • 3.3 Unit 3  Compound Interest
    • 3.4 Unit 4  Amortizing a Loan
  • 4 Chapter 4  The Valuation of Long-Term Securities
    • 4.1 Unit 1  Valuation Fundamentals
    • 4.2 Unit 2  Bond Valuation
    • 4.3 Unit 3  Common Stock Valuation
    • 4.4 Unit4  Rates of Return (or Yields)
  • 5 Chapter 5 Risk and Return
    • 5.1 Unit 1  Defining Risk and Return
    • 5.2 Unit 2  Using Probability Distributions to Measure Risk
    • 5.3 Unit 3  Attitudes Toward Risk
    • 5.4 Unit 4  Risk and Return in a Portfolio Context
    • 5.5 Unit 5  Diversification
    • 5.6 Unit 6  Beta and The Capital Asset Pricing Model (CAPM)
  • 6 Chapter 6 Capital budgeting
    • 6.1 Unit 1  Capital Investment Decisions
    • 6.2 Unit 2  Guidelines for Estimating Project Cash Flows
    • 6.3 Unit 3  Investment Rules
    • 6.4 Unit 4  Analyzing Project Risk
  • 7 Chapter 7  Cost of Capital and Capital Structure
    • 7.1 Unit 1   Types of Financing
    • 7.2 Unit 2   Cost of Capital Concept
    • 7.3 Unit 3  the Financing Mix and Capital Structure
    • 7.4 Unit 4  Understanding Financial Risk
    • 7.5 Unit 5  the Financial Leverage and the Value of a Firm
    • 7.6 Unit 6  Modigliani and Miller (M&M) theorem
  • 8 Chapter 8  Dividend Policy
    • 8.1 Unit 1  Dividends and Dividend Policy
    • 8.2 Unit 2  the Dividend Puzzle
    • 8.3 Unit 3  Factors Influencing the Dividend Decision
    • 8.4 Unit 4  Stock Repurchases
  • 9 Chapter 9  Working Capital Management
    • 9.1 Unit 1  Introduction to Working Capital Management
    • 9.2 Unit 2  Cash Management
    • 9.3 Unit 3  Accounts Receivable Management
    • 9.4 Unit 4  Inventory Management
Unit 3  Objectives of Financial Management







Discussion: 

1. Please explain the reason why the market price per share is the best one to represent the shareholders' wealth compared with the profit and EPS?

    From the shortcomings of the two alternaticve prospectives, we can analyze the reasons from three aspects. Firstly, the market price per share is a highly observable measure that can be used to evaluate performance of publicly held corporations. Secondle,  it takes into account present and future earnings per share, the timing, duration, and risk of these earnings, the firm’s dividend policy, and other factors affecting stock price. so it get ove all shortcomings of the profit and EPS maximization. Finally, share price can reflect the long-term effects of decisions made by the finacial managers. So the market price per share is a measure of the owner’s economic well-being.

2. From this formula, please ananlyze the advantages of share price maximization representing the objective of financial management.