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Fundamentals of Corporate Finance, 4/c/e

Fundamentals of Corporate Finance, 4/e

Stephen A. Ross, Massachusetts Institute of Technology
Randolph W. Westerfield, University of Southern California
Bradford D. Jordan, University of Kentucky
Gordon S. Roberts, York University

Credit and Inventory Management

Internet Application Questions


1		Working capital financing is no longer an area limited to traditional banks. In fact, for some high-growth industries, specialized companies such as RFC Capital step in and provide both advice and working capital loans, sometimes leading a syndicate. Click on the RFC Capital link below and describe their most recent working capital financing arrangement. http://www.rfccapital.com/



2		The Export Development Corporation (EDC) provides trade finance and risk management services to Canadian exporters and investors in up to 200 markets. Founded in 1944, EDC is a Crown corporation that operates as a commercial financial institution. One of their products is Equity Investments. This product allows a Canadian exporter to benefit from risk sharing of equity capital. Describe the advantage of this product vis-à-vis a more traditional line of credit.



3		How do you think banks make personal credit line decisions? As a student, you often face a banker who is trying to ascertain your "credit score." The following About.com site takes some of the mystery out of the personal credit approval process. http://credit.about.com/money/credit/gi/dynamic/offsite.htm?site=http%3A%2F%2Fwww.collegevisa.com%2Fhtml%2Fcss-6.html Based on the credit-scoring model provided in the link above, what are three of the most important items banks look at when making the personal credit decision?

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