What is the goal of financial management and what issues do financial managers confront?
GOALS: maximize the value of the firm to its owners, as well as upholding responsibilities to customers, employees, and other stakeholders.
ISSUES: conflicting goals between stakeholders and stockholders, balance between risk and return (risk-return trade off means that the higher the risk, the greater the return).
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Finance
- How do financial managers evaluate capital budgeting proposals?
- How do financial managers acquire and manage current assets?
- How do financial managers determine the firm's capital structure?
- How are the major sources of funds evaluated to meet a firm's short-term and long-term financial needs?
- What are the tools financial managers use to evaluate their company's financial conditions and develop future plans?