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    Imab Asghar
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    While increasing profit and market share can be objectives, they may not be appropriate as the sole objective for several reasons: - Profit and market share do not consider other stakeholders or social/environmental impacts. A sole focus on them could harm employees, community, or environment. - Short-term profit or growth may not be sustainable and could damage long-term success and survival of the company. - Other factors like innovation, quality, customer service and loyalty may be more important drivers of long-term success than immediate profit or size of market share.

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    While increasing profit and market share can be objectives, they may not be appropriate as the sole objective for several reasons: - Profit and market share do not consider other stakeholders or social/environmental impacts. A sole focus on them could harm employees, community, or environment. - Short-term profit or growth may not be sustainable and could damage long-term success and survival of the company. - Other factors like innovation, quality, customer service and loyalty may be more important drivers of long-term success than immediate profit or size of market share.

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    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
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    7 views1 page

    Finance

    Uploaded by

    Imab Asghar
    While increasing profit and market share can be objectives, they may not be appropriate as the sole objective for several reasons: - Profit and market share do not consider other stakeholders or social/environmental impacts. A sole focus on them could harm employees, community, or environment. - Short-term profit or growth may not be sustainable and could damage long-term success and survival of the company. - Other factors like innovation, quality, customer service and loyalty may be more important drivers of long-term success than immediate profit or size of market share.

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    Attribution Non-Commercial (BY-NC)
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    Question 1 Explain why each of the following might not be appropriate as a companys objective (a) Increasing profit (b)

    Increasing market share (6m) Question 2 Adam Inc, recently borrowed money for one year at 9%. The pure rate is 3%, and Adams Financial Condition warrants a default risk premium of 2% and a liquidity risk premium at 1%. There is little or not maturity risk in one year loans. What inflation rate do lenders expect next year? (2m) Use the interest rate model to solve the following problem. One year treasury securities are yielding 12% and 2-year treasuries yield 14%. The maturity risk premium is zero for one year debt and 1% for two-year debt. The real risk-free rate is 3%. What are the expected rates of inflation for the next two years? (4m) Question 3 Suppose you can earn 8% interest, compounded annually. How much must you deposit today to withdraw $10,000 in 6 years? (2m) Suppose you deposit $2000 in a savings account that pays 10% interest, compounded annually, how much will your account be worth in 15 years? (2m) Question 4 The following probability distributions of returns for two stocks have been estimated Probability Stock A Stock B 0.3 12% 5% 0.4 8% 4% 0.3 6% 3% Which stock would you choose? Why? (Base your answer on the co efficiency of variation to rank riskiness)

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