Assume that you have recently graduated and have just reported to work as an investment advisor at

Question:

Assume that you have recently graduated and have just reported to work as an investment advisor at the brokerage firm of Balik and Kiefer Inc. One of the firm's clients is SergieTurganev, a professional hockey player who has just come to Canada from Russia. Turganev is a highly ranked hockey player who would like to start a company to produce and market apparel with his signature. He also expects to invest substantial amounts of money through Balik and Kiefer. Turganev is very bright, and, therefore he would like to understand in general terms what will happen to his money. Your boss has developed the following set of questions that you must answer to explain the Canadian financial system to Turganev.
a. Why is corporate finance important to all managers?
b. Describe the organizational forms a business might have as it evolves from a start-up to a major corporation. List the advantages and disadvantages of each form.
c. How do corporations "go public" and continue to grow? What are agency problems? What is corporate governance?
d. What should be the primary objective of managers?
1. Do firms have any responsibilities to society at large?
2. Is stock price maximization good or bad for society?
3. Should firms behave ethically?
e. What three aspects of cash flows affect the value of any investment?
f. What are free cash flows?
g. What is the weighted average How do free cash flows and the weighted average interact to determine a firm's value?
i. Who are the providers (savers) and users (borrowers) of capital? How is capital transferred between savers and borrowers?
j. What do we call the price that a borrower must pay for debt capital? What is the price of equity capital? What are the four most fundamental factors that affect the cost of money, or the general level of interest rates, in the economy?
k. What are some economic conditions (including international aspects) that affect the cost of money?
l. What are financial securities? Describe some financial instruments.
m. List some financial institutions.
n. What are some different types of markets? Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...