tailieunhanh - Tài chính doanh nghiệp ( Bài tập)_ Chapter 13

Tài liệu bài tập thưc hành môn Tài chính doanh nghiệp_ Chapter 13 | Chapter 13 Corporate-Financing Decisions and Efficient Capital Markets a. Firms should accept financing proposals with positive net present values NPVs . b. Firms can create valuable financing opportunities in three ways Fool investors. A firm can issue a complex security to receive more than the fair market value. Financial managers attempt to package securities to receive the greatest value. Reduce costs or increase subsidies. A firm can package securities to reduce taxes. Such a security will increase the value of the firm. In addition financing techniques involve many costs such as accountants lawyers and investment bankers. Packaging securities in a way to reduce these costs will also increase the value of the firm. Create a new security. A previously unsatisfied investor may pay extra for a specialized security catering to his or her needs. Corporations gain from developing unique securities by issuing these securities at premium prices. Weak form. Market prices reflect information contained in historical prices. Investors are unable to earn abnormal returns using historical prices to predict future price movements. Semi-strong form. In addition to historical data market prices reflect all publicly-available information. Investors with insider or private information are able to earn abnormal returns. Strong form. Market prices reflect all information public or private. Investors are unable to earn abnormal returns using insider information or historical prices to predict future price movements. a. False. Market efficiency implies that prices reflect all available information but it does not imply certain knowledge. Many pieces of information that are available and reflected in prices are fairly uncertain. Efficiency of markets does not eliminate that uncertainty and therefore does not imply perfect forecasting ability. b. True. Market efficiency exists when prices reflect all available information. To be efficient in the weak form the market .