ExpendituresassociatedwithSECapproval. Expendituresassociatedwithmonitoringmanagement’sactions Expendituresassociatedwithinventorycontrol. c ANSWER: Explainthechainofcommandinacorporation. ANSWER: Therearefivecompetitiveforcesthatinfluenceanindustry’sstructure. 1.Thethreatofnewentrants. ANSWER: Thethreatofsubstituteproducts Thebargainingpowerofbuyers Thebargainingpowerofsuppliers Therivalryamongcurrentcompetitors Whataretheshortcomingsintheprofitmaximizationobjectiveasamanagerialstrategy? 1.Profitmaximizationlacksatimedimension. ANSWER: Thereisaquestionastowhichprofitistobemaximized:totalprofit,rateofprofitorEPS. Thereisnodirectwaytoconsidertheriskassociatedwithalternativedecisions. Preferredstockisconsideredprioritystock.Explainthispriority. ANSWER: WhatistheadvantageofanLLCoveranLLPbusinessform? AnLLC(orlimitedliabilitycompany)hasthreeadvantages: ANSWER: Hasbetteraccesstocapitaltofinancegrowth. Itenablesbroademployeeownershipofthefirm. Itenablesthefirmtoengageinstrategicacquisitions. Listexamplesofagencycostswhichareincurredbyshareholdersintryingtominimizeagencyproblems. ANSWER:
ExpendituresassociatedwithSECapproval. Expendituresassociatedwithmonitoringmanagement’sactions Expendituresassociatedwithinventorycontrol. ANSWER: c Explainthechainofcommandinacorporation. ANSWER: Therearefivecompetitiveforcesthatinfluenceanindustry’sstructure. ANSWER: 1.Thethreatofnewentrants. Thethreatofsubstituteproducts Thebargainingpowerofbuyers Thebargainingpowerofsuppliers Therivalryamongcurrentcompetitors Whataretheshortcomingsintheprofitmaximizationobjectiveasamanagerialstrategy? ANSWER: 1.Profitmaximizationlacksatimedimension. Thereisaquestionastowhichprofitistobemaximized:totalprofit,rateofprofitorEPS. Thereisnodirectwaytoconsidertheriskassociatedwithalternativedecisions. Preferredstockisconsideredprioritystock.Explainthispriority. ANSWER: WhatistheadvantageofanLLCoveranLLPbusinessform? ANSWER: AnLLC(orlimitedliabilitycompany)hasthreeadvantages: Hasbetteraccesstocapitaltofinancegrowth. Itenablesbroademployeeownershipofthefirm. Itenablesthefirmtoengageinstrategicacquisitions. Listexamplesofagencycostswhichareincurredbyshareholdersintryingtominimizeagencyproblems. ANSWER:
Test-Bank-for-Contemporary-Financial-Management-13th-Edition-by-Moyer.docx