1. 1 "Wealth maximization, rather than profit maximization, should be a firm's goal". Do you agree or disagree with this statement? Discuss your arguments and include a detailed explanation supporting your argument.
2. "A higher discount rate/required rate will increase the value of the bond". Do you agree or disagree with this statement? Why?
3. Discuss the strategies you can use for addressing agency issue.
4. Discuss the difference between a bond's coupon interest rate and required return? Discuss the factors that can influence the interest rate.
6. You would like to have 98 lakhs in your account 10 years from now to buy a flat in Mirpur. For achieving this target, you would like to make two separate deposits in your saving account that pays 7% annual interest rate, which compounds annually. All the deposits will be a single deposit investment. Today you make the first deposit of 25 lakh. What would be the second deposit you need to make 6 years from now so that you can have that 98 lakhs to buy that flat.
7. Suppose your firm will receive 100 today, 2000 after one year, followed by 3500, 4000, 5000 in the subsequent three years. Your opportunity cost is 8%. Calculate the combined present value of these cash flows.
8. Square Company asked you to determine the most it should pay to purchase a particular financial deal from Summit. Summit is offering a financial deal that consists of cash flows of $500 at the end of each year for 5 years. The required return is 8%.
9. Currently, you have 10,000 in a savings account that you are operating in City Bank. Two years from now, you are planning to deposit 14000, followed by another 16000 in four years from now. 
10. How much money will be in your account five years from now? The bank will provide you with a deposit rate of 8%.

Answer rating: 100% (QA)

Responses to Finance Questions 1 Wealth maximization vs Profit maximization Agree While profit maximization focuses on shortterm gains wealth maximization prioritizes longterm value creation for share... View the full answer