Question: Explain why the present value of a cash flow stream, and the asset associated therewith; fluctuate in value with the level of interest rates in

  1. Explain why the present value of a cash flow stream, and the asset associated therewith; fluctuate in value with the level of interest rates in the capital markets.

2. List and explain the points of financial impact on a company if it raises the credit standards required of its customers who utilized trade credit offered by the

company.

  1. Define Weighted Average Cost of Capital and explain why a company must earn at least its Weighted Average Cost of Capital on new investments. What are the financial implications if it does not?

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