Short term and long term profits

Assignment Help Finance Basics
Reference no: EM1344424

Managers should not focus on the current stock value because doing so will lead to overemphasis on short-term profits at the expense of long-term profits.

In your post, explain what is meant by this statement. Describe how management might decide whether to focus on short term or long term goals and how that decision impacts the organization. Next, Compute an example of how focusing on short term profits can be detrimental to long term profits. Share your opinion regarding whether you feel it's a better option to focus on short term or long term goals. Use evidence from the text or external sources to support your position.

 

Reference no: EM1344424

Questions Cloud

Explain what is the actual rate : Explain what is the actual rate the payday loan business is charging on its loans?
Expalining independent of choice of a dbms : Which of the following is independent of the choice of a DBMS?
Explaining real-world group support system success stories : Identify one real-world Group Support System success stories (e.g., from vendor Web sites or from reports/articles) and describe them.
Find what is this offer worth to you today : Find what is this offer worth to you today at a discount rate of 8% - npv or CF function or timeline
Short term and long term profits : Managers should not focus on current stock price because doing so will lead to overemphasis on short term benefits at expense of long-term profits.
Percentage change in the price of bonds laurel : Whereas the Hardy Corp. bond has 15 years to maturity. If interest rates suddenly fall by 2 percent, the percentage change in the price of Bonds Laurel, Inc
Factors-principles considering indecency regulation issues : What factors and principles should the federal government take into account when considering indecency regulation issues?
Describing cost of financial distress : Find out the value of the firm's equity? What is the promised return on company's debt? Find out the value of the firm? How much would the company's debt be worth if there were no bankruptcy costs?
Find the real cost of hedging : A United State company negotiated a forward agreement to buy 100,000 British pounds in 90 days. The firm was supposed to use the £100,000 to buy British supplies.

Reviews

Write a Review

Finance Basics Questions & Answers

  Computation of initial return earned by investors

Computation of initial return earned by investors who are allocated shares in the IPO and how much will WCMC receive from this offering

  Computation of present value of cash flows to make purchase

Computation of present value of cash flows to make purchase decision where demand is so high for Anderson Electric's products that the company cannot manufacture enough inventory to satisfy demand

  Future value with compounding interest

Calculate the following-Future value of $1000 for 10 years at 8% compounded, if the compounding is:

  Computing share price in a year

A share of stock sells for $35 today. The beta of stock is 1.2, expected return on market is 12%. The stock is expected to pay a dividend of $0.80 in one year.

  Computation of present value of an investment

Computation of present value of an investment and present value if you receive these payments at the beginning of each year rather than at the end of each year

  Bond - precentage change

Consider an American bond with an effective duration (which is pretty much the same as modified duration, but more precise) of 6.76 years having a yield to maturity of 7% and interest rates are expected to rise by 50 basis points.

  Several important finance questions

The existence of financial intermediaries greatly increases the efficiency of financial markets because, without them, savers would have to provide funds directly to borrowers,

  The important steps in the process

Elucidate the process you will utilize to accomplish this task, including the information you will want also the important steps in the process.

  Market risk premium under capm

Analysts give Proctor & Gamble, the consumer products firm, an equity beta of 0.65. The risk-free rate is 4.0 percent. What market risk premium is she assuming?

  Computation of wacc for a firm

Computation of WACC for a firm and based on the information provided, calculate the weighted average cost of capital (WACC)

  Examine the mix of debt and equity

Please examine the mix of debt and equity that British Petroleum (BP) uses. After finding this data:

  Relating investment under many capital budgeting techniques

Relating investment under various capital Budgeting Techniques and whichever project you choose

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd