Reading...
Play button
Play button
Use LEFT and RIGHT arrow keys to navigate between flashcards;
Use UP and DOWN arrow keys to flip the card;
H to show hint;
A reads text to speech;
16 Cards in this Set
- Front
- Back
|
Capital Budgeting
|
What long-term investment should the firm take on?
Evaluating the size, timing and risk of future cash flows |
|
|
Capital Structure
|
Where will we get the long-term financing to pay for the investment?
Internal vs External What mixture of debt and equity should the firm use to fund operations? |
|
|
Working Capital Management
|
How will we manage the everyday financial activities of the firm?
|
|
|
Debentures
|
unsecured debts of a firm with maturities greater than 10 years
|
|
|
Notes
|
unsecured debt with original maturity < 10 years
|
|
|
Amortized Loan
|
A loan where the borrower pays interest each period, and repays some or all of the principal of the loan over time.
|
|
|
Agency Costs
|
the costs of any conflicts of interest between stockholders and management
|
|
|
Specialist
|
a member of the NYSE acting as a dealer in one or more securities on the exchange floor.
|
|
|
R
|
nominal rate
|
|
|
r
|
real rate
|
|
|
h
|
inflation rate
|
|
|
Nominal Rate
|
is the percentage change in the number of dollars you have.
Rates of return that have not been adjusted for inflation. |
|
|
Real Rate
|
is the percentage change in how much you can by with your dollars- in other words, the percentage change in your buying power.
Rates of return that have been adjusted for inflation. |
|
|
Current Yield
|
Coupon Payment / Price
|
|
|
Capital Gains Yield
|
(Old Price - New Price)/Old Price
|
|
|
Clean Price
|
Dirty Price - Accrued Interest
|
