BBF302/05 Financial Management

1. Wawa Enterprise recently made a significant investment in Research and Development to improve its beauty product offerings in early 2022. Although these enhancements will have no influence on performance in the short term, they are predicted to greatly reduce future expenses. Discuss the impact of investment on Wawa Entreprise's earnings per share in 2022. Explain how this investment may affect the company's intrinsic value and stock price.
2. Elaborate five (5) reasons why financial markets are important for a healthy economy and economic growth.