4. Basic Financial Analysis in Marketing

a. Markups and markdowns

b. Discounts

c. Contribution margin analysis

i. Breakeven

unit, sales, volume dollar sales, for obtaining certain levels

of profit

ii. Profitability

iii. Unit and Sales calculations

d. Conditional sales forecasts

e. Scenario analysis

f. Expected values

Terms and Concepts

Capital budgeting Net worth or book value

Capital structure Market value per share

Agency theory Historical cost basis

Institutional investors Average tax rate

Shareholder wealth

maximization

Marginal tax rate

Sole proprietorship Tax shield

General partnership Liquidity

Limited partnership Trend analysis

Corporation LIFO

Money markets FIFO

Capital markets Primary markets

Private market Initial Public Offering

Secondary markets Marketable Security

Treasury bills Financial Intermediary

Commercial paper Capital Cost Allowance

Public market Bankers Acceptances