1. Explain why the present value of a stream of cash flow and assets associated there with, fluctuate in value with the level of interest rates in the bond markets.
2. List and explain the points off inancial impact on a company if it increases the required standards of credit to their customers using trade credit provided by the company.
3.Set theAverage CostofCapital(WeightedAverage CostofCapital)and explain whya company mustearn at leastitsweighted average cost ofcapital on new investments. What are thefinancial implicationsif it does?
4.As a corporationwhat are thebenefits and consequences ofthe use ofconvertibledebt areto finance apublicly tradedcompany? As an investor, what are the benefits andramifications ofthe purchase ofconvertibledebtin apublicly tradedcompany? Are there conflictsbetween the objectivesof the investor andthecompany goals?
5.Which two of the six methods used to evaluate projects, and decide whether or not tobe acceptedas CFO you prefer? Explain why you decidedon the two and not the other four. List theperceived shortcomings of the four whowere not selected.
6.What are thebenefits and costs ofplacing acompany withfinancial problemsin a Chapter11Bankruptcy?