Principles of Finance Paper Assignment Example | Topics and Well Written Essays - 1000 words

Principles of Finance Paper - Assignment ExampleDiscussion The initiative article of belief discusses the competitive fiscal environment. This convention outlines four factors that affect the furrow environment. These are the principle of expediency behaviour, the principle of two-sided transactions, the signalling principle and the behavioural principle (Emery, Finnerty and Stowe, 2007). The principle of self-interest means that the company provide always look out for its best interests. BP develops new and innovative technologies for oil exploration and drilling. This technology is utilise to further the companys interests. New drilling techniques are not revealed to competing companies. The principle of two-sided transactions means that BP often cooperates with minor companies around the world in the provision of its services. These collaborations are mutually unspoiled to both parties. The signalling principle explores the concept of a companys decisions influence on the public. BPs enthronisation in research on renewable energy creates a positive impression on the public, qualification them more willing to invest in an environmentally-conscious company. The behavioural principle means that a company utilises trade information to make rewarding investments. BPs investments have grown to include alternative energy, shipping and exchequer services. This is in addition to its wide variety of oil and gas investments. This wide portfolio caters to a wide trudge of market needs, cementing BPs position as one of the largest companies in the world. The four principles of value are The principle of valuable ideas, the principle of comparative advantage, the options principle and the principle of incremental benefits (Emery, Finnerty and Stowe, 2007). BPs research and development part produces innovations in solar power, biofuel and wind power. These fresh and new ideas keep the company ahead of its competitors. Following the principle of comparative adv antage, BP has established a reputation as a success in its field. This public perceptual experience as a financial giant gives them an edge over their competitors. The company also gains incremental benefits when it invests millions in green energy and renewable energy. Though these amounts may seem a waste, the investments pay off in scientific discovery and public approval of the companys efforts. BP also ensures it has a variety of business options to invest in, cushioning them against serious losses should one option fail (Benninga, 2008). The principles that emerge from observing financial transactions are the principle of risk-return trade-off, the principle of diversification, the principle of market capital efficiency and the time-value-of-money principle (Emery, Finnerty and Stowe, 2007). spend large amounts of money in ventures such as offshore drilling pays off with great dividends. zip industries are a high-risk, high-return enterprise. BP also diversifies its invest ments in multiple securities, ensuring maximum returns. The capital market runs on an cost-efficient system, with up-to the minute coverage of stock prices. BP is registered on high-profile stock exchanges such as the London Stock transfer (LSE) and the New York Stock Exchange (NYSE). Updates on stock are relayed internationally