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BUS635.

4: Managerial Finance
Define following terms with example
1. Finance 2. Agency problem
3. Profit maximization 4. Hedging
5. Diversification 6. Financial statement
6. Income statement 8. Balance sheet
9. Cash flow statement 10. Time value of money
11.Present value 12. Future value
13.Annuity immediate 14. Annuity due
15.Effective rate 16. Floatation cost
16.Return 18. Real rate of return
19.Risk-free rate of return 20. Nominal rate of return
21.Risk 22. Systematic risk
23.Unsystematic risk 24. Business risk
25.Financial risk 26. Risk premium
27. Common stock 28. Preferred stock
29. Bond 30. Debenture
31. Cost of money 32. Financial asset
33. Perpetual security 34. Financial market
35. Optimum capital structure 36. Optimum dividend policy
37. Clientele effect 38. Dividend relevancy theory
39. Free cash flow hypothesis 40. Wealth maximization
41. Cost of capital 42. Weighted average cost of capital
43. Residual dividend 44. Information content hypothesis.

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