PART 3: LONG-TERM WORKING CAPITAL CONSIDERATIONS CAPM, STOCK VALUATION, AND PROJECT EVALUATION TOOLS (1–2 PAGES, PLUS CALCULATIONS IN EXCEL) CAPM and Required Return: The company has a beta of 1.1, and the closest competitor has a beta of 0.30. The required return on an index fund that holds the entire stock market is 11%. The […]
Tag Archives: Capital budgeting
What are three factors under the firm’s control that can affect its cost of capital?
THE COST OF CAPITAL Creating Value at GE Why should the cost of capital be calculated as a weighted averageof the various types of funds a firm generally uses, not the cost ofthe specific financing used during a given year? Identify the firm’s three major capital structure components, andgive their respective component cost symbols. Why […]
Why does the World Bank prefer IRR over NPV for its funded projects?
Capital Budgeting Q.1 From a corporate capital budgeting perspective, there are four major evaluation criteria , as follows: 1) Net Present Value 2) Internal Rate of Return 3) Modified Internal Rate of Return 4) Payback period Discuss the advantages and limitations of each of the above. If there is one you prefer, state the reasons […]
How do you believe these acquisitions will allow this, and any other retailer, to achieve financial goals and create financial retail strategy?
Week 4 To Acquire or Not to Acquire? To Merge or Not to Merge? As we think about the goals of the firm, financial management, and overall retail financial strategy we should also think about how mergers and acquisitions play a part in achieving profitability and increasing market share for the firm. Should a firm […]
Discuss its main points, why you feel the article is relevant, and relate the article to your business and/or how the article relates to business practices, given your level of experience.
During Week 4 you examined the concept and evaluation methods used in making capital budgeting decisions. For this discussion, you are to use BSU and locate an academic journal article related specifically to “Capital Budgeting” that you find interesting. In your opening post, you are to: prepare a synopsis of the article, discuss its main […]
What would be the total value of the cash flows at the end of the third year, if the funds are reinvested at the firms’s cost of capital?
Using the computation tool(s) of your choice to determine NPV or IRR, answer the eight capital budgeting problems found at the following link: Capital Budgeting Problems Problem 1 A firm’s cost of capital is 12 percent. The firm has three investments to choose among; the cash flows of each are as follows: Cash Inflows A […]
Explain how and why corporations make specific decisions in the areas of capital budgeting, raising capital, and propose the best Debt/Equity ratio suitable for an internationally recognized stock listed enterprise (i.e. NYSE, SME, etc).
Managerial finance Assess how and why corporations make specific decisions in the areas of capital budgeting, raising capital, and propose the best Debt/Equity ratio suitable for an internationally recognized stock listed enterprise (i.e. NYSE, SME, etc). Analyze and integrate concepts from the course for optimum benefits of debt over equity such as cash management, inventory […]
What are the six key concepts for managerial accountants to understand when making decisions for their organizations:
Select one of the following questions to answer in your discussion: 1. Describe a flexible budget, how it works, and the associated variances? 2. What are the six key concepts for managerial accountants to understand when making decisions for their organizations: 3. Discuss volume trade-off decisions to include the terms constraint and bottleneck. provide examples. […]
