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In: Business and Management

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James C.Van Horne










James C. Van Horne

All rights reserved. No part of this book m ay be reproduced in any form or by any m eans without permission in writing from the publishers.
Library of Congress C atalo g C ard No.: 71-140760
Printed in the United States of America
Current Printing (last digit):

1 0 9 8 7 6 5 4 3 2



To Mimi, D rew , Stuart, and Stephen


Though significant portions of Financial Management and Policy have been changed in this revision, its purpose remains: first, to develop an understanding of financial theory in an organized manner so that the reader may evaluate the firm’s investment, financing, and dividend deci­ sions in keeping with an objective of maximizing shareholder wealth; second, to become familiar with the application of analytical techniques to a number o f areas o f financial decision-making; and third, to expose the reader to the institutional material necessary to give him a feel for the environment in which financial decisions are made.
In revising, I have attempted to reflect changes that have occurred in financial theory and practice since the first edition as well as to sharpen and update existing material so that it is better structured and more easily comprehended. There is an increased emphasis upon valuation and upon linking various financial decisions with valuation. In this regard,…...

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