1. Explain the difference between maximizing profit and adding value using an example of an organization and...
Question:
1. Explain the difference between maximizing profit and adding value using an example of an organization and explain why adding value is so critical to an organization. (Learning Outcome, Module 7 #1)
2. Does compound interest have more of an impact on short-term investments or long-term investments? Do you think it's possible to have uninterrupted compound growth? (Learning Outcome, Module 7 #2)
3. In Jay-Z's "The Story of O.J.," he says that young people should invest in their future as he has:
"Financial freedom my only hope/ F**k living rich and dying broke/I bought some artwork for one million/ Two years later, that s**t worth two million/ Few years later, that s**t worth eight million."
But only after he spent millions on his car collection and since cars are a depreciating asset and the value drops ~20% the moment it's driven off the lot or off a flatbed:
"I bought every V12 engine/ Wish I could take it back to the beginnin'/ I coulda bought a place in DUMBO before it was DUMBO/ For like 2 million/ That same building today worth 25 million/ Guess how I'm feelin'? Dumbo.
Explain how the time value of money concept goes beyond cash and what it means for portfolio investing. (Learning Outcome, Module 7 #3)
Links:
Auditing An International Approach
ISBN: 978-0071051415
6th edition
Authors: Wally J. Smieliauskas, Kathryn Bewley