Respuesta :
Answer:
a. Financing for public corporations must flow through financial markets.
FALSE, it can flow through financial markets or financial intermediaries.
b. Financing for private corporations must flow through financial intermediaries.
FALSE, it can flow through financial markets or financial intermediaries.
c. Almost all foreign exchange trading occurs on the floors of the FOREX exchanges in New York and London.
FALSE, they are traded in many different markets around the world.
d. Derivative markets are a major source of finance for many corporations.
FALSE, the major source of financing for corporations are stock markets.
e. The opportunity cost of capital is the capital outlay required to undertake a real investment opportunity.
FALSE, opportunity cost of capital refers to lost earnings resulting from choosing one investment over another alternative.
f. The cost of capital is the interest rate paid on borrowing from a bank or other financial institution.
FALSE, opportunity cost of capital refers to lost earnings resulting from choosing one investment over another alternative.
a. False: Financing for public corporations must flow through financial markets.
b. False: Financing for private corporations must flow through financial intermediaries.
c. False: Almost all foreign exchange trading occurs on the floors of the FOREX exchanges in New York and London.
d. False: Derivative markets are a major source of finance for many corporations.
e. False: The opportunity cost of capital is the capital outlay required to undertake a real investment opportunity.
f. False: The cost of capital is the interest rate paid on borrowing from a bank or other financial institution.
Financing is a process through which funds are provided for business activities (operating), making purchases, or investing in other areas.
Generally, financial institutions such as banks, are saddled with the responsibility of providing capital (funds) to businesses, investors, creditors and consumers, in order to help them achieve their goals.
a. False: Financing for public corporations must flow through financial markets.
- Financing for public corporations can either flow through financial markets or financial intermediaries.
b. False: Financing for private corporations must flow through financial intermediaries.
- Financing for private corporations can either flow through financial markets or financial intermediaries.
c. False: Almost all foreign exchange trading occurs on the floors of the FOREX exchanges in New York and London.
- The floors of the FOREX exchanges in New York and London is mainly for trading non-volatile foreign exchange such as Dollar, Euros, etc.
d. False: Derivative markets are a major source of finance for many corporations.
- The stock market is a major source of financing for corporations.
e. False: The opportunity cost of capital is the capital outlay required to undertake a real investment opportunity.
- The opportunity cost of capital is the increased return on investment that a business firm looses by using its capital (funds) for an alternative investment.
f. False: The cost of capital is the interest rate paid on borrowing from a bank or other financial institution.
- It is the cost of a business firm's debt and equity or rate of return on a portfolio from an investor's perspective.
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