FIN 534 Week 6 Case Study | Assignment Help | Strayer University
- strayer university / FIN 534
- 20 Nov 2020
- Price: $8
- Other / Other
FIN 534 Week 6 Case Study | Assignment Help | Strayer University
Mini Case
Instructions
Answer the following
questions in a separate document. Explain how you reached the answer or show
your work if a mathematical calculation is needed, or both. Submit your
assignment using the assignment link.
This course requires
the use of Strayer Writing Standards. For assistance and information, please
refer to the Strayer Writing Standards link in the left-hand menu of your
course. Check with your professor for any additional instructions.
Mini Case
Suppose you decide (as
did Steve Jobs and Mark Zuckerberg) to start a company. Your product is a
software platform that integrates a wide range of media devices, including
laptop computers, desktop computers, digital video recorders, and cell phones.
Your initial client base is the student body at your university. Once you have
established your company and set up procedures for operating it, you plan to
expand to other colleges in the area and eventually to go nationwide. At some
point, hopefully sooner rather than later, you plan to go public with an IPO
and then to buy a yacht and take off for the South Pacific to indulge in your
passion for underwater photography. With these plans in mind, you need to
answer for yourself, and potential investors, the following questions:
1. What is an agency relationship? When
you first begin operations, assuming you are the only employee and only your
money is invested in the business, would any agency conflicts exist? Explain
your answer.
2. Suppose your company raises funds from
outside lenders. What type of agency costs might occur? How might lenders
mitigate the agency costs?
3. What is corporate governance? List five
corporate governance provisions that are internal to a firm and are under its
control.
4. Briefly describe the use of stock
options in a compensation plan. What are some potential problems with stock
options as a form of compensation?
5. Briefly explain how regulatory agencies
and legal systems affect corporate governance.