chap 1 - intro to corporate finance Flashcards
1
Q
capitol budgeting
A
the process of planning and managing a firm’s long-term investments
2
Q
capitol structure
A
the mixture of debt and equity maintained by a firm
3
Q
working capital
A
a firm’s short term assets and liabilities
4
Q
sole proprietorship
A
a business owned by a single individual
5
Q
partnership
A
a business formed by two or more individuals or entities
6
Q
corporation
A
a business created as a distinct legal entity composed of one or more individuals or entities
7
Q
agency problem
A
the possibility of conflict of interest between the stockholders and management of a firm
8
Q
stakeholder
A
someone other than a stockholder or creditor who potentially has a claim on the cash flows of the firm
