Principles of Corporate Finance
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Questions and Answers

What is the guiding logic of all corporate finance?

  • Corporate umbrella insulates the eventual owners from personal risk
  • All projects must be self-liquidating (correct)
  • New investments should be made by well-managed enterprises
  • New capital should be financed in ways that create new owners
  • What is the expected payback period for new equipment in the corporate sector?

  • Within six to eight years
  • Within one to two years
  • Within ten to twelve years
  • Within three to five years (correct)
  • How much new productive assets are added annually to the U.S. economy?

  • Over $1 trillion
  • Over $10 trillion
  • Over $2 trillion (correct)
  • Over $5 trillion
  • What is the purpose of Capital Homesteading?

    <p>To democratize access to future capital ownership and profits</p> Signup and view all the answers

    What does the Center for Economic and Social Justice call the process of Capital Homesteading?

    <p>Counter-inflationary process</p> Signup and view all the answers

    What would Capital Homesteading provide to all citizens?

    <p>Self-liquidating capital credit</p> Signup and view all the answers

    What is the purpose of extending binary corporate finance throughout the economy?

    <p>To break the monopoly of capital ownership</p> Signup and view all the answers

    What is the definition of 'pure credit'?

    <p>Credit independent of past savings</p> Signup and view all the answers

    What would be the result of limiting the extension of 'pure credit' by the central bank to current non-owners?

    <p>Noninflationary expansion of the ownership of capital assets</p> Signup and view all the answers

    What would be the effect of distributing capital incomes broadly within a nation of owners?

    <p>Reduction in prices</p> Signup and view all the answers

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