Write a 4-5 page paper in which you:
1. Imagine you are a small business owner. Determine the financial ratios that are important to the
business. Compare your ratios with those that are important to a manager of a larger
corporation that’s similar. Example: The business is a small coffee shop;compare ratios to Starbucks. Starbucks financial ratios will be public infomortaion and easily accessible.
2. Explain the advantages and disadvantages of debt financing and why an organization would
choose to issue stocks rather than bonds to generate funds.
3. Discuss how financial returns are related to risk.
4. Describe the concept of beta and how it is used.
5. Contrast systematic and unsystematic risk.
6. Imagine your manufacturing corporation has just won a patent lawsuit. After attorney and other
fees, your corporation will have about $1 million. Explain how you plan to invest the money in
order to diversify the risk and receive a good return. Support your decisions with the principles of finance.
**You may use graphs to show statistics.