Explain and elaborate on the axioms of finance

Assignment Help Financial Management
Reference no: EM131999419

Explain and elaborate on the following axioms of finance:

1. Risk - return trade-off

2. Time value of money

3. Cash is king

4. Incremental cash flows

5. The agency problem

6. Taxes bias business decisions

7. All risk is not equal

8. Ethical dilemmas are everywhere in finance

Reference no: EM131999419

Questions Cloud

What is the minimum variance portfolio : Approximately what is the Minimum Variance Portfolio? what would impact will it have on Portfolio Diversification?
The company has the structure of capital : The joint stock company has a total capital of 330 mil. USD. The company has the following structure of capital:
What factor is mainly responsible for change : What factor is mainly responsible for the change in Tesco’s ROA over this period?
Equity based mutual fund has outstanding number of units : An Equity based Mutual Fund has an outstanding number of units of 150 laky units (Face Value = Rs. 10).
Explain and elaborate on the axioms of finance : Explain and elaborate on the following axioms of finance. Risk - return trade-off, Time value of money, Cash is king
Annual payments must be made to discharge the loan : What equal annual payments must be made to discharge the loan, plus pay the bank its required rate of interest?
How much interest will he pay over the life of loan : How much interest will he pay over the life of the loan? How much will his annual payments be?
The fund is the entire risky portfolio : Which Fund exhibited the best performance over this period from the perspective of an Investor for whom the fund is the entire Risky portfolio?
What is the npv of this investment opportunity : What is the NPV of this investment opportunity? What is the NPV of the project now?

Reviews

Write a Review

Financial Management Questions & Answers

  The current set of spot interest rates

The current set of spot interest rates with one, two, three and four years to maturity are 4%, 6%, 7% and 7.5% respectively.

  Determined by the fraction that is invested in market

A portfolio's risk premium and volatility are determined by the fraction that is invested in the market.

  Company currently has one bond issue outstanding

Company currently has one bond issue outstanding. This bond pays a coupon rate of 10% ($100 per year) and matures in five years, and has a par value of $1,000. If you require a 14% rate of return. What is the capital gain yield of this bond in the fi..

  Equal year-end deposits in savings account

You have decided to place equal year-end deposits in a savings account for the next 9 years.

  What is maximum you should be willing to pay for investment

What is the maximum you should be willing to pay for this investment?

  What do the terms core deposits and volatile

What do the terms core deposits and volatile, or noncore, deposits mean? Explain how a bank might estimate the magnitude of each.

  The company need to meet its target fixed assets-sales ratio

If Williamson's sales increase 12%, how large of an increase in fixed assets will the company need to meet its target fixed assets/sales ratio?

  Which investment has the higher present value

Investment X oers to pay you $3,700 every year for the next nine years, whereas investment Y oers to pay you $5,500 per year for the next ve years. If the interest rate is 6%, which investment has the higher present value?

  How expensive home mortgage can you afford

Suppose you have budgeted $ 1175 a month towards a mortgage. If you are offered a 30 year mortgage at an interest rate of 7.5%, how expensive a home mortgage can you afford?

  What is the sensitivity of ocf to changes in variable cost

Calculate the base-case cash flow and NPV. What is the sensitivity of OCF to changes in the variable cost figure?

  Calculate firms weighted average cost of capital

Select any publically traded company (Wal-mart) and use the techniques from the text to calculate firms weighted average cost of capital.

  What will michelles balance be in five years

Michelle works out her budget and decides she can afford to set aside $50 per month for savings. Her bank will pay her 3% on her savings account. What will Michelle's balance be in five years?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd