Agency Costs of Free Cash Flow‚ Corporate Finance‚ and Takeovers Michael C. Jensen Harvard Business School MJensen@hbs.edu Abstract The interests and incentives of managers and shareholders conflict over such issues as the optimal size of the firm and the payment of cash to shareholders. These conflicts are especially severe in firms with large free cash flows—more cash than profitable investment opportunities. The theory developed here explains 1) the benefits of debt in reducing agency
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Are the Federalist papers still Relevant? Keith Morphis The question of “Are the federalist papers still relevant?” is a very important question. It is especially important the current state of affairs in this country over the last 20 plus years. Throughout history also in other nations the arguments of the Federalist Papers ring true and human nature seems to reinforce them. One quote from the Federalist No.10 paper that I feel is more relevant now than ever especially for someone on the left is
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are still relevant in today’s society. He’s 450 years old and yet‚ not only do we perform his plays but also‚ we recognize ourselves in them and continue to use phrases and words he coined in our everyday language. The plays have been performed in almost every language‚ on stage and screen and at popular festivals and theaters around the world. BBC
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2/27/13 What Killed Michael Porter’s Monitor Group? The One Force That Really Matters - Forbes Steve Denning‚ Contributor R ADIC AL MANAGEMENT: R e think ing le ade rship and innovation L EA D ER S H I P | 11/20/2012 @ 10:52AM | 168‚820 vie ws What Killed Michael Porter’s Monitor Group? The One Force That Really Matters What killed the Monitor Group‚ the consulting firm co-founded by the legendary business guru‚ Michael Porter? In November 2012‚ Monitor was unable to pay its bills
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Blog Post Essay 3/2/15 Is Animal Farm still relevant today? Yes‚ and in a few ways. First‚ one element of the story is how power can corrupt any leader. Power hungry leaders are almost completely normal in our society today. Secondly the book has an element of human nature. Humans have a selfish side as shown by some of the animals‚ but also a caring side as shown by other animals. Finally‚ Animal Farm is relevant today because it has an element of propaganda
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Name: Class: Cost Accounting Date: 02.12.2012 Quiz 5 1) Absorption costing: A) expenses marketing costs as cost of goods sold B) treats direct manufacturing costs as a period cost C) includes fixed manufacturing overhead as an inventoriable cost D) is required for internal reports to managers 2) Variable costing: A) expenses administrative costs as cost of goods sold B) treats direct manufacturing costs as a product cost C) includes fixed manufacturing overhead as an inventoriable
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a topic is relevance‚ how is relevant to the age group? It is socio-culturally appropriate? Is it individually appropriate? All these question needs to be considered when choose a theme topic. Themes are relevant when the concepts they represent are directly tied to children’s real-life experiences and build on what children know. If relevance has been properly considered‚ themes are age appropriate‚ individually appropriate‚ and socio-culturally appropriate. Relevant themes highlight concepts with
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____ 1. A cost is not relevant if it: A. B. C. D. E. Does not differ for each option available to the decision maker. Changes from period to period. Is a future cost. Is a mixed cost. Is a fixed cost. 2. Variable costs will generally be relevant for decision making because they: A. B. C. D. E. Differ between options. Are volume-based. Have not been committed and differ between options. Differ between options and have been committed. Measure opportunity cost. 3. Fixed costs will often be
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Week I Quiz Results/Answers ECO561 1. Revenue increases when * producer surplus increases 2. An increase in the price of an inelastic good * increases revenues 3. Price elasticity of Demand increases when * people become less price sensitive over time 4. The purpose of a market in a market system is to * bring buyers and sellers into contact 5. By specializing in the production of one good‚ a company is able to benefit from economies of scale which increases its revenue. Which
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Q1: explicit costs and implicit costs concepts Explicit Cost Explicit cost is defined as the direct payment which is supposed to be made to others while running business. This includes the wages‚ rents or materials which are due in the contract. The explicit cost is the expense done in business which can easily be identified and accounted for in the business at any stage. The explicit cost represents the out flows of cash in clear and obvious terms. When any out flow of credit occurs in a business
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