Questions

Answer there following  in 175 

1.  There are many potential goals of a corporation, such as: minimize costs, maximize sales, maximize employment, maximize earnings, maximize shareholder wealth, maximize dividend payments, etc. Which one is the best for the long-term health of the company and society?(175 

2.  Winning one of the big national lotteries provides a choice of how to receive the money. You can receive a much-reduced lump sum (like half or so) today, or the full amount in twenty annual payments starting today. Discuss how you can determine which financial deal is better. Also, what are the non-financial aspects to winning the lottery and how do they influence which option to take?(175 

3.  Discuss how the bond market reacts when the Federal Reserve increases short term interest rates. How do short-term versus long-term bond prices react? How do Treasury bonds versus corporate bonds behave?(175 )

4.  Respond to the following: You have been offered the opportunity to get in on a once-in-a-lifetime investment. The returns will be very high, and your money is safe. Why is this not possible and most likely a scam?  (175 )

5.  The Federal Reserve lowers interest rates in the economy to increase economic activity. Using the capital budget decision tools, discuss how decreasing interest rates can cause firms to make more investments. 175 )