Find how financial management contributes to shareholder

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ABC Pvt. Ltd. was established by Mr. Tim Cook, from his savings. He initially sold his products only to friends and family and was able to pay for everything as he went along. Now that the business is growing, he knows he cannot finance the expansion out of the revenue generated presently, so he is considering taking a loan. He has no experience with financial institutions, other than the basics such as managing his personal bank accounts, a credit card, a mortgage and a car loan.

Your Task

Question 1. Explain to Tim cook how the monetary system works. In particular, describe the various financial institutions, options he has for raising capital for his business. Be certain to explain the advantages and potential disadvantages of each funding method that he could approach to seek funding.

Question 2. How financial management contributes to shareholder's profit maximization and which are its three variables which directly affect shareholder's wealth? Explain in details.

Question 3. What are the factors considered before issuing dividend? Should a company need dividend policy in a company? Explain in details.

Reference no: EM132614966

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