DUE: 11.28.14(Friday) @11:59PM
Finance managers must understand the components of the cost of debt capital. Since capital, or money, is a limited resource to a business, finance managers may need to raise capital to fund projects through debt. The cost of debt (interest rate) is influenced by creditworthiness, prevailing interest rates, and inflation. The credit worthiness of a firm is directly related to a company’s financial results, of which you, as the finance manager plays an essential role. If you haven’t already here you will learn and apply the principle that in the bond market is the inverse relationship between interest rates and bond values. Using this information you would learn to use a financial calculator to calculate bond features such as present value, rate, yield, etc. Finance managers have a perspective of economic events that may lead to higher interest rates. As a finance manager you would have access to expected interest rates on any borrowing that may occur. A relationship with the banking community may ensure you receive the most affordable interest rate.
Please note: A finance manager has the ability to use a financial calculator. The proper use of a financial calculator is a valuable and transferable skill that can apply to personal budgeting.
Please write a COMPLETE 1-page paper, double spaced that summarizes the following information above, and what you think of it.
Document Requirements:
Use standard 12-point font size
MS Word Document
1 page paper(Again, nothing less!)
1-2 sources in APA citation(I willn’t need anymore then 3 sources for sure)
Thorough Response is a must!!
And NO plagiarism!!
