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Great Depression: 1929-1933, An Overview of Finance: PART II, Public…
Great Depression: 1929-1933
economic depression
began with the stock market crashed
affected every country of the world
worst economic period in US
banking panics and monetary contraction
economic impact
human sufferiing
oversupply and overproduction
low demand, high unemployment
An Overview of Finance: PART II
Corporate Finance
Management Goal of Financial
Maximize profits
Minimize costs
Maximize market share
Maximize the current value of the company
Financial Managers
Chief Financial Officer
Treausurer
Controller
Financial Management Decisions
Capital Budgeting (Investment decision)
Capital Stucture (Financial decisions)
Working Capital management (Operative decisions)
Forms of Business Organization in the U.S
Sole Proprietoship
Single Owner
Advantages:Easier to start, singles owner keeps the profit.
Disadvantages: Difficult to sell ownership interest
Partnership
General
Limited
Adventages: Two or more owners, more capital avaiilable.
Disadvantages:unlimited liability, Limited partnership.
Corporation
C-Corporation
S-Corporation
Limited Liability Company (LLC)
Advantages:Limited Liability
Disadvantages: Separation of the ownershio and management
The Agency Problem
Agency relationship: An agent to represent the interests, run the company.
Agency Problem: Conflict of interst, agency costs.
Managing Managers
Agency costs
Managerial compensation
Corporate control
Other stakeholders
Public Limited Company Categories (Categorías de Sociedades Anónimas)
Sociedad Anónima (S.A)
Sociedad Anónima Promotora de Inversiones (S.A.P.I)
Sociedad Anónima Promotora de Inversión inscrita en el RNV (S.A.P.I.B)
Sociedad Anónima Bursátil (S.A.B)