Financial Management Questions
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- CONTEXT:
- Financial managers are known as the agents of owners who are the stockholders in a company. The goal of financial managers is to maximize the shareholders’ wealth. Shareholders have many options to invest their money. Financial markets bring investors and borrowers together for transfer of funds from investors to firms. For the markets to be efficient, proper rules and regulations are necessary.
- Resources
SUGGESTED RESOURCES
The following optional resources are provided to support you in completing the assessment or to provide a helpful context. For additional resources, refer to the Research Resources and Supplemental Resources in the left navigation menu of your courseroom.
Library Resources
The following e-books or articles from the Capella University Library are linked directly in this course:
- Weaver, S. C., & Weston, J. F. (2001). Finance and accounting for nonfinancial managers. New York, NY: McGraw-Hill.
- Sherman, E. H. (2011). Finance and accounting for nonfinancial managers (3rd ed.). New York, NY: American Management Association.
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Assessment Instructions
Respond to the following five questions. Write your responses in a Word document, and number them 1–5.
- Define the terms finance and financial management. What are the major sub-areas of finance?
- Identify and define the three basic forms of business ownership. Describe the advantages and disadvantages of each.
- Define the terms agency relationship and agency problem. Explain three different approaches to minimizing the agency problem.
- Explain why ethical behavior is so important in the field of finance.
- Explain the concept of shareholder wealth maximization. Is there a conflict between the goal of shareholder wealth maximization and the financial manager’s need to act in an ethical manner? Why or why not?
Use references to support your answers as needed. Be sure to cite all references using correct APA style. Your responses should be free of grammar and spelling errors, demonstrating strong written communication skills.
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2/1/2021 Financial Management Scoring Guide Financial Management Scoring Guide CRITERIA NONPERFORMANCE BASIC PROFICIENT DISTINGUISHED Define the terms ‘finance’ and ‘finance management.’ Does not define the terms ‘finance’ and ‘finance management.’ Defines the terms ‘finance’ and ‘finance management’ but omits key elements. Defines the terms ‘finance’ and ‘finance management.’ Defines the terms ‘finance’ and ‘finance management’ and connects them to relevant real-world situations. Identify major subareas of finance. Does not identify major sub-areas of finance. Identifies sub-areas of finance but not major sub-areas. Identifies major sub-areas of finance. Defines major sub-areas of finance and connects the definitions to relevant realworld situations. Define the forms of Does not identify business ownership. the forms of business ownership.Financial Management Questions
Defines the forms of business ownership using inaccurate or incomplete information. Defines the forms of business ownership. Defines the forms of business ownership and explains the advantages and disadvantages of each. Define the term “agency relationship.” Does not define the term “agency relationship.” Incorrectly defines the term “agency relationship.” Defines the term “agency relationship.” Defines the term “agency relationship” and connects the definition to relevant real-world situations. Define the term “agency problem.” Does not define the term “agency problem.” Defines the term “agency Defines the term problem” but omits key “agency problem.” elements. Defines the term “agency problem” and connects the definition to relevant realworld situations.Financial Management Questions
Explain why ethical behavior is especially important in the field of finance. Does not explain why ethical behavior is important in the field of finance. Explains ethical behavior but does not connect its importance to the field of finance. Explains why ethical behavior is especially important in the field of finance. Analyzes why ethical behavior is especially important in the field of finance. Explain the concept of shareholder wealth maximization. Does not explain the concept of shareholder wealth maximization. Explains the concept of shareholder wealth maximization using inaccurate or incomplete examples. Explains the concept of shareholder wealth maximization. Explains the concept of shareholder wealth maximization and connects it to relevant real-world situations. https://courserooma.capella.edu/bbcswebdav/institution/BUS-FP/BUS-FP3062/191000/Scoring_Guides/u01a1_scoring_guide.html 1/1 …Financial Management Questions