Title:
Financial institutions, investments and management : an introduction
Personal Author:
Edition:
8h ed.
Publication Information:
Indianapolis, IN : Howard W Sams & Co 2004
ISBN:
9780030312984
Available:*
Library | Item Barcode | Call Number | Material Type | Item Category 1 | Status |
---|---|---|---|---|---|
Searching... | 30000010039632 | HG181 M39 2004 | Open Access Book | Book | Searching... |
Searching... | 30000010029065 | HG181 M39 2004 | Open Access Book | Book | Searching... |
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Summary
Summary
A well-written, well-illustrated survey of the field of finance covering the three major components of the discipline: financial institutions, investments, and financial management. The text is designed for the beginning student with minimal or no background in finance or related topics. Relevant economic and accounting concepts are either reviewed or treated as if the student has no prior exposure. The text is paperback represents a great value as it is less expensive than competitors.
Table of Contents
Preface | p. xiii |
Chapter 1 Introduction to Finance | p. 1 |
The Divisions of Finance | p. 2 |
Key Financial Concepts | p. 3 |
Finance and Other Business Disciplines | p. 7 |
Plan of the Text | p. 8 |
Part I Financial Institutions | p. 10 |
Chapter 2 The Creation of Financial Assets | p. 13 |
Forms of Business | p. 14 |
The Role of Money | p. 18 |
The Role of Interest Rates | p. 20 |
The Transfer of Funds to Business | p. 23 |
The Direct Transfer: The Issuing and Selling of New Securities | p. 24 |
The Indirect Transfer Through Financial Intermediaries | p. 31 |
Summary | p. 45 |
Review Questions | p. 46 |
Chapter 3 The Federal Reserve and the Supply and Cost of Credit | p. 49 |
The Role of the Federal Reserve System | p. 50 |
The Expansion of Money and Credit | p. 55 |
The Tools of Monetary Policy | p. 62 |
The Impact of Fiscal Policy on Credit Markets | p. 65 |
Impact of an Inflationary Economic Environment on Credit Markets | p. 68 |
The Impact of International Currency Flows on Credit Markets | p. 73 |
Summary | p. 85 |
Review Questions | p. 86 |
Problems | p. 88 |
Chapter 4 The Role of Securities Markets | p. 89 |
Securities Markets | p. 90 |
The Mechanics of Investing in Securities | p. 95 |
Measures of Security Prices | p. 99 |
Regulation | p. 102 |
Foreign Securities | p. 104 |
Competition in the Security Markets | p. 105 |
Summary | p. 108 |
Review Questions | p. 109 |
Problems | p. 110 |
Part II Investments | p. 112 |
Chapter 5 The Tiem Value of Money | p. 115 |
The Future Value of a Dollar | p. 116 |
The Present Value of a Dollar | p. 122 |
The Future Value of an Annuity | p. 125 |
The Present Value of an Annuity | p. 131 |
Illustrations of Compounding and Discounting | p. 135 |
Nonannual Compounding | p. 144 |
Periods of Less Than One Year | p. 145 |
Summary | p. 146 |
The Equations for the Interest Factors | p. 147 |
Review Questions | p. 148 |
Problems | p. 148 |
Chapter 6 Risk and Its Management | p. 153 |
The Return on an Investment | p. 154 |
The Sources of Risk | p. 155 |
Beta Coefficients | p. 167 |
The Capital Asset Pricing Model and an Investment's Required Return | p. 175 |
Summary | p. 178 |
Review Questions | p. 178 |
Problems | p. 179 |
Appendix Using Excel to Compute Standard Deviations and Regressions Equations | p. 183 |
Chapter 7 Equity: Preferred and Common Stock | p. 187 |
Equity | p. 188 |
The Features of Preferred Stock | p. 190 |
Preferred Stock and Bonds Contrasted | p. 191 |
Analysis of Preferred Stock | p. 193 |
Disadvantages of Preferred Stock From an Investor's Perspective | p. 194 |
Common Stock | p. 195 |
Dividend Policy | p. 197 |
Cash Dividends | p. 204 |
Stock Dividends | p. 206 |
Stock Splits | p. 207 |
Dividend Reinvestment Plans | p. 210 |
Repurchase of Stock | p. 210 |
Summary | p. 211 |
Review Questions | p. 212 |
Problems | p. 213 |
Chapter 8 Valuation of Stock | p. 217 |
Valuation of Preferred Stock | p. 218 |
Valuation of Common Stock: The Present Value and the Growth of Dividends | p. 220 |
Risk and Stock Valuation | p. 225 |
Alternative Valuation Techniques: Multiplier Models | p. 228 |
Summary | p. 230 |
Review Questions | p. 231 |
Problems | p. 232 |
Chapter 9 Investing in Long-Term Debt (Bonds) | p. 237 |
Characteristics of All Debt Instruments | p. 238 |
Types of Corporate Bonds | p. 241 |
Foreign Bonds | p. 245 |
Registered and Book Entry Bonds | p. 246 |
Determination of the Price of a Bond | p. 246 |
Yields | p. 250 |
Retiring Debt | p. 256 |
Convertible Bonds and Convertible Preferred Stock | p. 258 |
Convertible Preferred Stock | p. 268 |
Government Securities | p. 269 |
Summary | p. 273 |
Review Questions | p. 274 |
Problems | p. 275 |
Chapter 10 Analysis of Financial Statements | p. 279 |
General Accounting Principles | p. 280 |
The Balance Sheet | p. 281 |
The Income Statement | p. 287 |
Statement of Cash Flows | p. 289 |
Limitations of Accounting Data | p. 293 |
Depreciation | p. 294 |
Losses and Tax Savings | p. 300 |
Ratio Analysis | p. 302 |
Liquidity Ratios | p. 304 |
Activity Ratios | p. 307 |
Profitability Ratios | p. 312 |
Leverage Ratios | p. 314 |
Coverage Ratios | p. 318 |
Analysis of Financial Statements and the Internet | p. 320 |
Analysis of Financial Statements and the Use of Excel Spreadsheets | p. 322 |
Summary | p. 326 |
Review Questions | p. 327 |
Problems | p. 328 |
Chapter 11 Investment Companies | p. 335 |
Investment Companies: Origins and Terminology | p. 336 |
Closed-End Investment Companies | p. 338 |
Mutual Funds | p. 342 |
The Returns Earned on Investments in Mutual Funds | p. 347 |
Selecting a Mutual Fund | p. 350 |
Index Funds and Exchange-Traded Funds | p. 353 |
Summary | p. 354 |
Review Questions | p. 354 |
Problems | p. 356 |
Part III Corporate Finance | p. 358 |
Chapter 12 Break-Even Analysis and Leverage | p. 361 |
Break-Even Analysis | p. 362 |
Operating Leverage | p. 366 |
Financial Leverage | p. 370 |
Financial Leverage and Risk | p. 373 |
Financial Leverage Through Preferred Stock Financing | p. 377 |
Summary | p. 378 |
Review Questions | p. 379 |
Problems | p. 379 |
Chapter 13 Cost of Capital | p. 383 |
Components of the Cost of Capital | p. 384 |
Cost of Capital: A Weighted Average | p. 391 |
The Optimal Capital Structure | p. 393 |
The Marginal Cost of Capital | p. 395 |
The Optimal Capital Structure and the Value of the Firm's Stock | p. 399 |
Cost of Capital Review and Problem Areas | p. 402 |
Summary | p. 403 |
Review Questions | p. 404 |
Problems | p. 405 |
Chapter 14 Capital Budgeting | p. 409 |
Valuation and Long-Term Investment Decisions | p. 411 |
Importance of Cash Flow | p. 412 |
Payback Period | p. 414 |
Introduction to Discounted Cash Flows Methods of Capital Budgeting | p. 416 |
Net Present Value | p. 417 |
Internal Rate of Return | p. 419 |
Net Present Value and Internal Rate of Return Compared | p. 421 |
Ranking Investment Opportunities | p. 427 |
The Introduction of Risk into Capital Budgeting | p. 434 |
Risk Adjustments in Capital Budgeting | p. 436 |
Adjusting the Discount Rate | p. 439 |
Summary | p. 443 |
Review Questions | p. 444 |
Problems | p. 445 |
Chapter 15 Planning: Forecasting and Budgeting | p. 453 |
Planning | p. 454 |
Fluctuations in Asset Requirements | p. 456 |
Forecasting External Financial Requirements: Percent of Sales | p. 457 |
Forecasting External Financial Requirements: Regression Analysis | p. 464 |
Forecasting External Financial Requirements: Changes in Fixed Assets | p. 470 |
The Cash Budget | p. 472 |
Summary | p. 480 |
Review Questions | p. 481 |
Problems | p. 481 |
Chapter 16 Management of Short-Term Assets | p. 489 |
Working Capital and Its Management | p. 490 |
The Impact of the Operating Cycle on Working Capital Policy | p. 491 |
Financing and Working Capital Policy | p. 494 |
The Inventory Cycle | p. 497 |
The Economic Order Quantity | p. 498 |
Management of Accounts Receivable | p. 509 |
Cash Management | p. 514 |
Money Market Instruments and Yields | p. 518 |
The Calculation of Yields | p. 520 |
Summary | p. 522 |
Review Questions | p. 523 |
Problems | p. 524 |
Chapter 17 Sources of Short- and Intermediate-Term Funds | p. 529 |
Free Sources: Accruals | p. 531 |
Commercial Bank Loans | p. 531 |
Trade Credit | p. 538 |
Commercial Paper | p. 543 |
Secured Loans | p. 545 |
Factoring | p. 547 |
Intermediate-Term Debt | p. 548 |
Leasing | p. 551 |
Bankruptcy and Reorganization | p. 559 |
Summary | p. 562 |
Review Questions | p. 563 |
Problems | p. 564 |
Chapter 18 Derivatives and Risk Management | p. 569 |
Options | p. 570 |
The Intrinsic Value of an Option to Buy Stock | p. 571 |
Leverage | p. 573 |
Call Options | p. 576 |
Puts | p. 582 |
Stock Index Options | p. 584 |
Futures | p. 586 |
Hedging | p. 593 |
Financial and Currency Futures | p. 595 |
Stock Index Futures | p. 598 |
Summary | p. 600 |
Review Questions | p. 601 |
Problems | p. 602 |
Appendix A Interest Factors for the Future Value of One Dollar | p. 605 |
Appendix B Interest Factors for the Present Value of One Dollar | p. 606 |
Appendix C Interest Factors for the Future Value of an Annuity of One Dollar | p. 607 |
Appendix D Interest Factors for the Present Value of an Annuity of One Dollar | p. 608 |
Appendix E Answers to Selected Problems | p. 609 |
Index | p. 617 |