Fundamentals of Corporate Finance

M

M&M. See Modigliani and Miller propositions

MACRS. See Modified Accredited Cost Recovery System

Maintenance conflict, 491

Management. See also Financial management

compensation, 16–17

Sarbanes-Oxley Act of 2002 and, 19

stockholder interests and, 16–18

Managerial labor market, 17

Managers

compensation of, 16–17

competition among, 17

incentives for, 16–17

perspective on financial statement analysis, 85

as stakeholders, 2

Marginal tax rates

average tax rate versus, 74–75

calculating, 344

defined, 74

example, 75

firm (t), 331

in progressive tax system, 343

Market efficiency

defined, 35

in-depth discussion resource, 36

informational, 35

operational, 35

semistrong-form, 36

strong-form, 35–36

weak-form, 36

Market extension projects, 388

Market portfolio, 208

Market risk

defined, 208

required rate of return on, 211

Market risk premium

common stock cost of equity and, 376

defined, 211, 364

Market transactions, 30

Market value

assets, 59–60, 365, 366

balance sheet, 60–62

book value versus, 59–62

claims of assets, 366

defined, 59

equity, 60, 366

of equity per share, 103

liabilities, 60

in WACC calculations, 382

Marketability

defined, 32

interest rates and, 238

Marketability risk premium (MRP), 238

Markets. See also Financial markets

auction, 256

broker, 256

dealer, 256

defined, 42

direct search, 256

foreign exchange, 560–568

historical performance of, 194–197

stock, 254–259

Market-to-book ratio, 102–103

Market-value indicators, 102–103

Marking to market, 59

MAT (term to maturity), 450