Strategic Corporate Finance Workshop - Research Paper Example

Only on StudentShare

Extract of sample
Strategic Corporate Finance Workshop

A shareholder may not find investment in the company as an attractive option taking into consideration the time value of money. Thus, profit maximisation does not provide any assurance with regard to the timing and risk associated with the cash flow either. It can be concluded that profit maximisation does not help in improving the value placed on the company by the shareholders. It is needless to say that it is the funds from the shareholder that mainly supports the operations of a company and shortage in such funds could affect the survival of the company in the long run. Therefore, profit maximisation should not be the ultimate goal of a financial manager.
Just like profit maximisation, sales maximisation would not bear an impact on the market value of the company. Sales maximisation does not even assure profit maximisation, leave alone enhancing the company's value. Sometimes, the cost involved in maximising the sales may even cancel out the benefit derived from it.
In today's world, it is extremely important for every company to be socially responsible. Social responsibility includes maximising benefits to the employees and the society at large. ...
Download paper

Summary

A company's value in the market is based on the market price of its stock. The market price also functions as an indicator of the level of performance of the company. The market price of the company's stock is a function of the quantum of cash flows from the investment in its stock, the timing of such cash flow and the risk associated with realization of the cash flow…
Author : tkeebler

Related Essays

issues in corporate finance
Most important, companies have to understand the value of trading-off aspects of capital because such practise results to better performance.…
8 pages (2008 words) Assignment
Module: Corporate Finance
RWT basically stated that speculative price changes were independent and identically distributed, so that the past price data had no predictive power for future share price movements. RWT also stated that the distribution of price changes from transaction to transaction had finite variance. In addition, if transactions were fairly uniformly spread across time and were large in numbers, then the Central Limit Theorem suggested that the price changes would be normally distributed. (Please check your citation by using Harvard system…
10 pages (2510 words) Essay
Corporate Finance Case Study
The company's other division, ALSO, provides 'information and communications technology and consumer electronics in the wholesale and logistics sectors (Google Finance 2009).' Schindler operates in 125 countries, with its 45,063 employees around the world, while most of its ALSO operations cater to European customers (Yahoo Finance).…
10 pages (2510 words) Case Study
Corporate Finance Master Essay
Since capital markets are neither perfect nor complete, all of these decisions interact with one another. (Allen & Michaeli, 2005, p.3)…
5 pages (1255 words) Essay
Corporate Finance Project
Because of their fewness, oligopolists have considerable control over their prices, but each must consider the possible reaction of rivals to its own pricing, output & advertising decision.…
16 pages (4016 words) Essay
Corporate Finance
The flat world is here to stay, and has conquered both time and distance.…
1 pages (251 words) Essay
Got a tricky question? Receive an answer from students like you! Try us!