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Managerial Finance Questions ***Original Answers Please**** Each question should be labeled and references cited per question. Plagiarism report MUST be attached!!!! Each number answered in full graduate level work required!!!
1. Read the journal article, “Businesses Seeking Working Capital-Survey.” Based on the information presented in the article, discuss the following:
- How should a business use working capital analysis?
- Which is more important to the short-term lender: the stock of cash or the flow of cash?
- Is it possible in today's business to operate with no current liabilities?
Should be 200-250 words in length.
2. Compare and contrast the Internal Rate of Return (IRR), the Net Present Value (NPV) and Payback approaches to capital rationing. Which do you think is better? Why? Provide examples and evidence from two articles from ProQuest to support your position. Should be 200-250 words in length.Explanation & Answer
1
Running Head: MANAGERIAL FINANCE
Managerial Finance
Name of student
Institution
Professor
Date
2
MANAGERIAL FINANCE
1.
The Use of Capital Working Analysis
The survey of working capital analysis has formed a basis that lenders use in
understanding why investor borrows money and for what reasons. The investors are also updated
on the best type of loans to pursue their businesses as well as understanding the return interest
rates from the loans. A good example is that the survey shows that working capital loans are the
most sought as they have very low-interest rates hence enabling the investors to take the risk
since the costs involved are too little (Businesses Seeking Working Capital-Survey, 2015).
The lenders are also able to understand the use at which the capital is going to be
employed hence enabling them to set their interest rates per the type of loan. Some the
companies have had difficulties in meeting their targets and hence opting for financial assistance.
To understand the best loan lenders, they have to be familiar with the capital working analysis. It
is through the analysis that the performance of ...
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