discussion

Do you agree or disagree with any of the concepts in post below? Why an investment decision like this is not always as straightforward as it might seem. Provide information or concepts that may not have been considered.

This I imagine is a tempting quick decision for a financial matter, but a cautious and thorough financial matter will dig into this further to make sure they are not jumping the gun on what might seem like a slam dunk decision. Although economic downturns and how those downturns affect a market are risks that financial managers must think about before assuming an investment. For instance, the market today is unstable due to the economic downturn and the pandemic we are facing. At this time, it would be a wise a decision to pay down debt than to make a hefty investment in an unstable market.

It is a sad time we are in witnessing so many businesses close their doors, debt and equity ratios are on the rise and companies will need to start looking into bankruptcy. Our text stated this happens when the value of assets equals the value of its debt. So in relation to the video we watched for this discussion the longer working capital sits on shelves or is tied up, also means a company is still in debt without any money coming in, instituting financial danger for the company. Strategically planning and pitfalls along the way is extremely important for financial managers to make it through economic downturns such as this pandemic.