What circumstances do the NPV and IRR methods differ?
Both of these measurements are primarily used in capital budgeting, the process by which companies determine whether a new investment or expansion opportunity is worthwhile.…
Finance
What are the social responsibilities should be carried out by the firm?
The major arguments for the assumption of social responsibilities by business are: Public expectations: Social expectations of business have increased dramatically since the 1960s. Public…
Why is wealth maximization considered a better approach than profit maximization?
We know that the goals of financial management are profit maximization and wealth maximization. These are the important objectives of business firms. Now the question…
What is an Annuity?
An annuity is a contract that can increase in value and provide a steady income over a long period of time. People often use annuities…
The Principles of Finance
There are ten principles that form the basis of FINANCIAL MANAGEMENT. These can be called as the foundation of finance that plays a significant role…
Explain different sources of risk
Traditionally investors have talked about several sources of total risks, such as interest rate risk and market risk, which are explained below, because these terms…
What are stockholders wealth maximization goal?
Wealth maximization model is a superior model because it obviates all the drawbacks of profit maximization as a goal to a financial decision. Firstly, the…
What is the basic goal of a business firm?
From Finance’s stand-point there are two main goals: Profit Maximization Shareholders’ Wealth Maximization PROFIT MAXIMIZATION: Simply a single-period or a short-term goal to be achieved…
Difference between Risk and Uncertainty
The difference between Risk and Uncertainty are as follows: Risk Definition: Risk can be defined as the chance that some unfavorable events will occur. Probability distribution: Risk…
Who is a financial manager?
The financial manager plays an important role in the functional areas of finance. The assignments of finance functions to the financial manager depend upon the…
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