Shannon Bland
Ayda Sanver Halker
FIN 100
January 30, 2011
Explain why Market prices atomic number 18 utiliseful to a Financial film director.
We use merchandise prices to measure out the cost and benefits of a ending in terms of bullion today it is then a simple matter to tempt the best decision for the firm. The most important job of a financial manager is to organize the firms investment funds decision. The Financial Manager must weigh the cost and benefits of each investment or project and decide which of them qualify as good use of the money stockholders have invested in the firm. These investment decisions fundamentally work on what the firm does and whether it will add value for its owners. Financial Managers ask trade prices to be converted into equivalents of cash value. Once they dismiss express cost and benefits into terms of cash today, it is a straight-forward sour to compare them and determine whether the decision will step-up the firms value.
deal how the Valuation Principle helps a Financial Manager make decisions.
The valuation principle is the value of the commodity or an plus to the firm or its investors is determined by its competitive market price. The benefits and cost of a decision should be evaluated using those market prices.
When the value of the benefits exceeds the value on the costs, the decision will increase the market value of the firm. The valuation principle provides the basis for decision making for Financial Markets.
Describe how the Net Present nurse is related to cost-benefit synopsis.
The Net Present Value is the difference amongst the present value of a project or investments benefits and the present value of its costs. In terms of a formula NPV = PV(benefits) PV(cost). This is related to the cost-benefit analysis because the cost benefit analysis determines if the value of benefit will exceed the costs and increase the value of a firm.
Explain how an interest rate is unspoilt a...If you want to get a full essay, order it on our website: Ordercustompaper.com
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