What is capitalization

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Reference no: EM131229154

Paper - Capitalization Risks in Finance

To minimize the confusion with the broad term of Capitalization, please use/consider the following definitions when writing your paper.

Defining Capitalization in Finance:

What is Capitalization?

In finance, capitalization is a quantitative assessment of a firm's capital structure. The capital structure is how a firm finances its overall operations and growth by using different sources of funds. Debt comes in the form of bond issues or long-term notes payable, while equity is classified as common stock, preferred stock or retained earnings.  Short-term debt such as working capital requirements is also considered to be part of the capital structure.

Capitalization is the amounts and types of long-term financing used by a firm.  Types of financing include common stock, preferred stock, retained earnings, and long-term debt.  A firm with capitalization including little or no long-term debt is considered to be financed very conservatively.

Assignment: 

Write a five page, double spaced paper in APA format discussing Capitalization within finance. The paper should cover challenges and risks of running a large multi-national financial institution such as a bank or insurance company. The risks can focus on management risks, currency risks, geo-political risks, and markets security risks, etc. You can also go into detail about the risks U.S. multinational financial companies faced with the "BREXIT" event of the U.K. leaving the European Union. You may also discuss in your paper about how you might invest internationally through U.S. multi-national companies and the American Depository Receipt (ADR's) impact on the European Union's (EU) decision on the American tech giant, Apple's, cash and taxes.

Reference no: EM131229154

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