3OO w0rds ex.plain the diagram below.  *Ex.plain the procedures involved in the financial decision and the investment decision

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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In 3OO w0rds ex.plain the diagram below. 

*Ex.plain the procedures involved in the financial decision and the investment decision

 

The Finance Decision (External)
Capital
Equity
Debt
Govt. Aid
}
CAPITAL
MARKET
Distributions
Capital
Gains
Acquisition of
Funds
→
Objective
Minimum Cost
of Capital (WACC)
The Investment Decision (Internal)
Disposition of
Funds
Objective
Maximum Cash
Profit (NPV)
Corporate
Objectives
Internal
Maximum Economic Value Added
(EVA)
External
Maximum Market Value Added
(MVA)
Corporate Wealth Maximisation
(Shareprice)
}
Assets
Fixed
Current
MANAGEMENT
POLICY
Retentions
Transcribed Image Text:The Finance Decision (External) Capital Equity Debt Govt. Aid } CAPITAL MARKET Distributions Capital Gains Acquisition of Funds → Objective Minimum Cost of Capital (WACC) The Investment Decision (Internal) Disposition of Funds Objective Maximum Cash Profit (NPV) Corporate Objectives Internal Maximum Economic Value Added (EVA) External Maximum Market Value Added (MVA) Corporate Wealth Maximisation (Shareprice) } Assets Fixed Current MANAGEMENT POLICY Retentions
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