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Who are wealthy individuals who invest in new and growing firms?
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∙ 10y ago
Angel Investors
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∙ 10y ago
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Why do firms invest and borrow?
Firms invest in order to make dividend and interest income when they have an excessof money over current operating expenses.Firms borrow to pay bills when they have an excess of operating expenses over the cash available.
How do investment bankers generate revenues for their firms?
Investment bankers can generate revenues for their firms by the amount of money they bring in from their customers. By bringing in money, the firm will have more to invest.
Why do firms need to invest in net working capital?
there is a need to invest in net working capital because net workin capital represents the surplus working capital left with the company after payment of current liablities, hence more net working capital means company has surplus money for its day to day operations
What factors helps explain the volatility of investment?
1. Durability Because capital goods are so durable the purchase of new capital goods are discretionary and can be postponed. Optimisim about the future may promt firms to invest big into a new facility. While a leaa optimistic view may lead firms to invest small into reparing older facilities to keep in use. 2. Irregularity of Innovation Technological progress is a major determinant of investment. New products ond processes stimulate investment. But as history shows major innovations such as the computer or electricity are very irregular. When they do happen though there is an upsurge in investment spending that in time will recede. 3. Variability of profits When deciding whether or not to invest, a firm's expectations about potential profitability of the investment are influeced by the size of profits earned by other firms from similar investments. Inclining profits gives firms greater incentives and means to invest, while decling profits have an inverse effect. Sice actual profits are variable this adds doubly to the instabiltiy of investment. 4. Variability of expectations firms project current business conditions into the future, but their expectations can change when an event happens that could cause a possible change in future business conditions. for example exchange rates, international peace, and legislative actions can all change future business activities and invesments. The stock market has an influence on business expectations because firms are constantly looking to it as an indicator of society's overall confidence in future business conditions.
Why cross boarder listing does not add any value to a firm?
currently the market (investors) does not invest in companies that don't have the same filing requirements that many U.S firms have. U.S firms must follow GAAP (generally accepted accounting principals) and file quarterly. Many firms in other countries do not have to follow certain rules and so it makes trusting their financial reports hard. The cross border listing doesn't add value to the firm is because there is a common belief that a large number of investors won't invest in a foreign company that does not do business in the country that the firm is cross listed in ex: Americans don't know anything about a soda that only sells in Pakistan. How do I know if Pakistanis even like the soda?
Why firms invest and borrow?
Firms invest in order to make dividend and interest income when they have an excessof money over current operating expenses. Firms borrow to pay bills when they have an excess of operating expenses over the cash available.
Why do firms invest and borrow?
Firms invest in order to make dividend and interest income when they have an excessof money over current operating expenses.Firms borrow to pay bills when they have an excess of operating expenses over the cash available.
Selling state-run firms to individuals?
privatize
How do investment bankers generate revenues for their firms?
Investment bankers can generate revenues for their firms by the amount of money they bring in from their customers. By bringing in money, the firm will have more to invest.
What are Investments created to invest many people's money in many different firms are called?
Treasury Bills
Most of those who invest in startups limit their investing to firms with potentially high returns in a period?
6_12 month
What are individuals who are employed by brokerage firms that are members of the exchange are called?
floor brokers
The concentration of the productive efforts of individuals and firms into a limited number of activities is called?
Specialization
What is one economic principle?
an economic princple is a widely accepted behaviour of individuals and firms
If competitive firm earn zero economic profit explain why anyone would invest money in them?
People do not invest money in firms because of what they are earning today. They invest money because they think the firm will turn a profit in the future. Markets are anticipatory. One other reason people invest is to buy a job. Several people will get together and purchase or create a business. Then they will hire themselves to run it. The income may simply be enough to pay the help. An owner may not get his money back until he sells his share of the business and his job.
The study of the economic behavior of individuals and firms is called?
Meaningful statement about the economic behavior or the economy is called?
What is an capitalist country?
A capitalist country is one in which the firms are run by private individuals rather than the government.
