Answer to Question #12601 in Finance for JLM

Question

•Drawing on what you discovered in the e-Activity, discuss how instances of corporate mismanagement or fraud should be taken into account when assessing the risks associated with certain types of investments.

Answer 1

Instances of corporate mismanagement or fraud should be taken into account.when assessing the risks associated with certain types of investments. Some& types of fraud and mismanagement will influence on cost of invested capital because they create additional risks which are covered by rate of capital cost.