Essentials of Corporate Finance
Figure 18.4 – Total Asset Requirement Over Time
Download
1.37 Mb.
Page
6/9
Date
14.01.2022
Size
1.37 Mb.
#86612
1
2
3
4
5
6
7
8
9
Ross FCF 10Ce Ch18
Ross FCF 10Ce Ch18
Navigate this page:
Choosing the Best Policy continued
Figure 18.4 – Total
Asset Requirement Over Time
18-
Choosing
the Best Policy
Cash
reserves
Pros – firms will be less likely to experience financial distress and are better able to handle emergencies or take advantage
of unexpected opportunities
Cons – cash and marketable securities earn a lower return
and are zero NPV investments
18-
Choosing
the Best Policy continued
Maturity hedging
Try to match financing maturities
with asset maturities
Finance temporary current
assets with short-term debt
Finance permanent current assets and fixed assets
with long-term debt and equity
18-
Download
1.37 Mb.
Share with your friends:
1
2
3
4
5
6
7
8
9
The database is protected by copyright ©sckool.org 2022
send message
Main page
different types