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Fundamentals of
Corporate Why Corporations Need
Finance Financial Markets and
Institutions
Fifth Edition
Slides by
Matthew Will
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Topics Covered
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Financial Markets
Money
OTC
Primary
Markets
Markets (Over-the-
counter)
Secondary
Markets
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Financial Markets
Financing Decision
Source of Funds “Capital”
Capital Structure
Money Markets
Euros
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Financial Markets
(2) (1)
Firm's Investors
Financial
operations (4a)
Manager (stockholders
save and invest
Real assets in closely held
firm.)
(timberland) (4b)
(3)
(1) Investors buy shares with cash
(2)Cash is invested
(3) Timber harvest generates cash
(4a) Cash reinvested
(4b) Cash returned to investors
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Financial Markets
Issue Debt
Company Investors
Cash
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Financial Markets
$ $
Bank of Windsor
Investors
America Fund
Sells Issues
shares shares
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Financial Markets
Company
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Financial Markets
Company
Banks Intermediary
Deposits Cash
Investor
Depositors
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Financial Markets
Company
Investor
Policyholders
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1.2 Households
23.2
Rest of world
37.9
Banks
Insurance Cos
Pension Funds
17.4 Mutual Funds
7.6 1.3 11.1 Other
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U.S. Financing
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Value Maximization
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