Corporations [LO3] What is the primary disadvantage of the corporate form of organization? Name at least two advantages of corporate organization.
the Financial Management Decision Process [LO1] What are the three types of financial management decisions? For each type of decision give an example of a business transaction that would be relevant.
2.Sole Proprietorships and Partnerships [LO3] What are the four primary disadvantages of the sole proprietorship and partnership forms of business organization? What benefits are there to these types of business organization as opposed to the corporate form?
3.Corporations [LO3] What is the primary disadvantage of the corporate form of organization? Name at least two advantages of corporate organization.
4.Sarbanes-Oxley [LO4] In response to the Sarbanes-Oxley Act many small firms in the United States have opted to go dark and delist their stock. Why might a company choose this route? What are the costs of going dark?
5.Corporate Finance Organization [LO1] In a large corporation what are the two distinct groups that report to the chief financial officer? Which group is the focus of corporate finance?
6.Goal of Financial Management [LO2] What goal should always motivate the actions of a firms financial manager?
7.Agency Problems [LO4] Who owns a corporation? Describe the process whereby the owners control the firms management. What is the main reason that an agency relationship exists in the corporate form of organization? In this context what kinds of problems can arise?
8.Primary versus Secondary Markets [LO3] Youve probably noticed coverage in the financial press of an initial public offering (IPO) of a companys securities. Is an IPO a primary market transaction or a secondary market transaction?
9.Auction versus Dealer Markets [LO3] What does it mean when we say the New York Stock Exchange is an auction market? How are auction markets different from dealer markets? What kind of market is NASDAQ?
10.Not-for-Profit Firm Goals [LO2] Suppose you were the financial manager of a not-for-profit business (a not-for-profit hospital perhaps). What kinds of goals do you think would be appropriate?