1. Chapter McGraw-Hill/Irwin Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved. 1 Introduction to Corporate Finance

2. Chapter 01 – Index of Sample Problems There are no problems for this Chapter

3. Corporate finance What is corporate finance? What is the role of financial manager? What is the goal of financial management? Financial management environment. Corporate form of organization. Conflicts within corporation.

4. Jobs of financial manager What long-run investment should take on? Capital Budgeting How to get long-run finance to pay for your investment? Capital structure Management of everyday financial activities. Working capital management

5. Forms of business organization Sole Proprietorship Partnership Corporation

6. Goal of financial management Maximize the current value per share of existing stock Maximize the market value of the existing owner’s equity

7. Agency problem Agency cost Managerial compensation Control of firm

8. Financial markets Cash flows to and from the firm

9. Chapter McGraw-Hill/Irwin Copyright © 2006 by The McGraw-Hill Companies, Inc. All rights reserved. 1 End of Chapter 1