...COURSE DESCRIPTION Introduces the concepts of finance. Reviews the basic tools and their use for making financial decisions. Explains how to measure and compare risks across investment opportunities. Analyzes how the firm chooses the set of securities it will issue to raise capital from investors as well as how the firm’s capital structure is formed. Examines how the choice of capital structure affects the value of the firm. Presents valuation and integrate risk, return and the firm’s choice of capital structure. INSTRUCTIONAL MATERIALS Required Resources Brigham, E. F., & Ehrhardt, M. C. (2014). Financial management (14th ed.). Mason, OH: South-Western Cengage Learning. Supplemental Resources MBA Primer Note: The MBA Primer is designed to help students with little or no educational background in business to prepare for the rigors of an MBA program. The MBA Primer is also a useful tool for students who have the business background but might need a refresher. It is a way to help you prepare for the types of activities and concepts that will be covered in the MBA program, so you can feel more comfortable and confident as you progress into higher level courses. Students are emailed an access code for this product when they purchase MBA Primer from the Strayer Bookstore, accessible through iCampus. CNN Money. (2013). General format. Retrieved from http://money.cnn.com/ Criniti, A. (2013). The necessity of finance. Philadelphia, PA: Criniti Publishing Company. ...
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...V O LU M E 1 9 | N U M B E R 2 | S PRING 2007 Journal of APPLIED CORPORATE FINANCE A MO RG A N S TA N L E Y P U B L I C AT I O N In This Issue: Valuation, Capital Budgeting, and Disclosure Enterprise Valuation Roundtable Presented by Ernst & Young 8 Panelists: Richard Ruback, Harvard Business School; Trevor Harris, Morgan Stanley; Aileen Stockburger, Johnson & Johnson; Dino Mauricio, General Electric; Christian Roch, BNP Paribas; Ken Meyers, Siemens Corporation; and Charles Kantor, Lehman Brothers. Moderated by Jeff Greene, Ernst & Young. The Case for Real Options Made Simple 39 Raul Guerrero, Asymmetric Strategy Valuing the Debt Tax Shield 50 Ian Cooper, London Business School, and Kjell G. Nyborg, Norwegian School of Economics and Business Administration Measuring Free Cash Flows for Equity Valuation: Pitfalls and Possible Solutions 60 Juliet Estridge, Morgan Stanley, and Barbara Lougee, University of San Diego Discount Rates in Emerging Markets: Four Models and an Application 72 Javier Estrada, IESE Business School Rail Companies: Prospects for Privatization and Consolidation 78 James Runde, Morgan Stanley A Real Option in a Jet Engine Maintenance Contract 88 Richard L. Shockley, Jr., University of Indiana A Practical Method for Valuing Real Options: The Boeing Approach 95 Scott Mathews, The Boeing Company, Vinay Datar, Seattle University, and Blake Johnson, Stanford University Accounting for Employee...
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...and we will arrange a mutually satisfactory time. For some students, telephone “meetings” are easier. To this end, you may call me at reasonable hours (i.e., before 10:00 p.m.). NOTE: It is the student’s responsibility to read, understand and abide by all of the course information and policies listed below. Failure to do so could result in you failing this course or being withdrawn from this course by your instructor, School of Business Dean’s Office or by the Graduate Studies Department. The course syllabus provides a general plan for the course; deviations may be necessary. COURSE PREREQUISITE: All MBA Foundations classes must be completed or waived before enrollment in FIN 611. REQUIRED MATERIALS: 1. Textbook – Corporate Finance: The Core, by J. Berk and P. DeMarzo, published by Prentice Hall, ISBN (10‐digit) 0132153688. Available in loose leaf (3‐ring) format in the U Tampa bookstore. Textbook are also available as an e‐book from coursesmart: 1 Revised 08/21/2012 2. Cases and readings: available from www.study.net – available by 8/27/12 3. Additional files and readings will be distributed via Blackboard 4. Calculator - A financial calculator is required for this class. A Hewlett Packard 10B or a Texas Instruments BAII+ is ideal. Other brands/models may also suffice. Bring your calculator to class every day. Be sure you know how to use it. 5. Laptop computer – Many students find it useful to use their laptop computer during class. This is not required...
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...Running head: CAPITAL BUDGETING Risk Analysis on Investment Decision Risk Analysis on Investment Decision Silicon Arts, Incorporated (SAI) is a manufacturer of circuits that are used in the manufacture of electronic equipment items. During their initial years in operation, there was an increase in the industry followed by a 40% decline. In order to remain competitive and stay profitable, SAI controlled expenses. Current trends indicate the industry may be on the rise again. SAI wants to develop some new capital investment projects that are in line with their goals: increase their market share, and keep pace with new technology (University of Phoenix, 2007). Future Scenarios The first task in the simulation was to examine probable future scenarios that could potentially affect SAI cash flow with two projects, Dig-image and W-Comm. Part of SAI’s plans is their desire to earn $54 million in their first year by selling 400,000 units, however they first need to determine their working capital. “Working capital rises over the early years of the project as expansion occurs. However, all working capital is assumed to be recovered at the end, a common assumption in capital budgeting” (Ross, Westerfield, & Jaffey, 2005, p. 183). SAI is expecting growth will be 20% in the first three years and then decrease 10% annually in years 4 and 5. SAI is expecting increasing competition, decreasing prices, and a short lifespan of the technology that could be obsolete before...
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...* Audience Analysis Exercise Your task: Set up a table and complete a side-by-side audience analysis for the scenarios. Use the audience analysis worksheet provided in this lesson. Invent any information you feel is necessary to make your analysis complete. Balance Scorecard Explanation – Audience Analysis. | | Scenario #1 | Scenario #2 | Context | Where will the audiences access and use the material | They will access the material digitally and implement the information on a strategic plan on the company. | They would have access via group presentation/meetings, and emails for those that are in other offices. | | What distractions will they face in the physical and political context | They are probably busy in the day-to-day operation of the company and they might underestimate this information. | Some of the members don’t feel comfortable having me as the leader of the project. | | What are the audiences’ working conditions (e.g., access to e-mail, available time)? | They work during office hours having access to a computer and internet (also emails). | They work during office hours having access to a computer and internet (also emails). | Audience | Who are the intended audiences? | Since he asked for the explanation Mr. Clark is the intended audience. | The Production Manager is my intended Audience. | | What are their purposes? | Use a BSC Technique to help implement a new strategic plan. | To understand how the BSC works (requirements, benefits, etc)...
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...MP A R Munich Personal RePEc Archive A critical analysis of Mudarabah & a new approach to equity financing in Islamic finance Shaikh, Salman Ahmed International Association of Islamic Banks 01. July 2011 Online at http://mpra.ub.uni-muenchen.de/19697/ MPRA Paper No. 19697, posted 19. September 2011 / 12:03 A Critical Analysis of Mudarabah & A New Approach to Equity Financing in Islamic Finance Journal of Islamic Banking & Finance, ISSN 1814-8042 By Salman Ahmed Shaikh Project Director, Islamic Economics Project islamiceconomicsproject@gmail.com www.islamiceconomics.viviti.com Abstract Financial intermediation serves a valuable purpose, but it can also be structured using equity modes of financing. This can relieve the financee and increase diversity of entrepreneurial undertakings as in debt based commercial financing, there is little room for diversity with obligatory and stipulated servicing of debt. Using Islamic equity modes of financing poses the challenge of the agency problem and moral hazard. The extent of this agency problem in Mudarabah and its impact on economic payoffs between counterparties is analyzed in this study with a simulation model. Based on review of alternate solutions proposed, the author presents two possible covenants which could make Mudarabah mode of financing more acceptable and widely usable in financial intermediation. This would also further the egalitarian objectives of an Islamic economic order. Keywords: Interest free economy, Islamic...
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...25 Finance Student 5010 South Robertson St. New Orleans, Louisiana 70115 (908)-752-2924 January 20, 2015 Anita Roddick, Founder: The Body shop International PLC 2001 Re: Case C: Chapter 8: The Body Shop International: An Introduction to Financial Modeling, Years 1 – 3 Observed Value of The Body Shop International as of February 28, 2004 = 2,000,000 GBP Dear Mrs. Roddick: As you requested, I have forecasted pro-forma statements and ratio analysis factors of The Body Shop International for Years 2001 through 2004, using the information presented in Bruner and the forecast assumptions on the Case Studies in Finance pages 120-126. I used these forecasted pro-forma statements as an Initial Scenario to analyze the interactive quality of the forecast assumptions made, and I adjusted the forecasted assumptions to I found the Borrowing amount for The Body Shop International as of 2001 (the beginning of Year 1) to be = $5,904,000. 1) & 2) I derived my forecast by taking a random growth rate percentage and the COGS/Sales ratio that the book had provided. As I plugged in higher growth rates the company debt began to grow larger. However the Retained earnings began to grow as well. The COGS/Sales ratio showed to have a similar affect but with a far greater increase in company debt. Whether there is an Increase in growth rate or and increase in the ratio of COGS/Sales, they both present an extreme increase in New Debt. If the COGS/Sales...
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...MP A R Munich Personal RePEc Archive A critical analysis of Mudarabah & a new approach to equity financing in Islamic finance Salman Ahmed Shaikh International Association of Islamic Banks 1. July 2011 Online at http://mpra.ub.uni-muenchen.de/19697/ MPRA Paper No. 19697, posted 19. September 2011 12:50 UTC A Critical Analysis of Mudarabah & A New Approach to Equity Financing in Islamic Finance Journal of Islamic Banking & Finance, ISSN 1814-8042 By Salman Ahmed Shaikh Project Director, Islamic Economics Project islamiceconomicsproject@gmail.com www.islamiceconomics.viviti.com Abstract Financial intermediation serves a valuable purpose, but it can also be structured using equity modes of financing. This can relieve the financee and increase diversity of entrepreneurial undertakings as in debt based commercial financing, there is little room for diversity with obligatory and stipulated servicing of debt. Using Islamic equity modes of financing poses the challenge of the agency problem and moral hazard. The extent of this agency problem in Mudarabah and its impact on economic payoffs between counterparties is analyzed in this study with a simulation model. Based on review of alternate solutions proposed, the author presents two possible covenants which could make Mudarabah mode of financing more acceptable and widely usable in financial intermediation. This would also further the egalitarian objectives of an Islamic economic order. Keywords: Interest free economy,...
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...FNCE90013 Case Studies in Finance SUBJECT GUIDE July – August, 2015 Prepared by George Kester Department of Finance Faculty of Business and Economics Objective To develop an understanding of applied corporate finance including financial analysis and forecasting, financing sales growth, short-term versus long-term financing, capital structure policy, capital investment analysis, cost of capital, and company valuation. The course will be experiential and focus upon selected Harvard Business School cases describing actual business situations faced by financial managers, requiring analysis, and decision-making. Professor Professor George W. Kester Texts Robert C. Higgins, Analysis for Financial Management (10th Editon), McGraw-Hill Irwin, 2012. Cases You should read and analyze each assigned case. The cases are available on the LMS page for FNCE90013. Readings Selected readings will be distributed during the course. Group Study It is recommended that you form yourselves into small study groups for the purpose of routinely reviewing and discussing assigned before each class. Your learning experience will be enhanced by such interaction and you will be better prepared for class. Presentations Copies of the PowerPoint slides of the presentations are available on the LMS page for FNCE90013. It is recommended that you print them out prior to each class. Attendance The class attendance will be taken. Participation ...
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...Cruz FIN/571 March 19, 2013 James Ciaramella Guillermo Furniture Store Concepts Paper First week (1st) individual assignment was write no more than 800 word paper explaining the finance concepts found in the Guillermo Furniture Store Concepts Paper and relate finance concepts to the context of the scenario. Following Finances Concepts and relationship with scenario assigned. Finance Finances are the studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. Finance is defined as the set of activities and administrative decisions that lead a company to finance the acquisition of fixed assets such as land, buildings, furniture, etc. and circulating such as cash, accounts and notes receivable, etc. The analyses of these decisions are based on the flows of income and expenditure and its effects on management objectives that the company intends to achieve. The definition of finance comprises several factors that are involved directly with them and some of them are such as investment, brokerage, personal financial planning, financial planners and advisers, securities analysts, agents real estate, etc. Finance Concepts at Guillermo’s Scenario 1 Guillermo Navallez, is an entrepreneur localized in Sonora Mexico. Sonora Mexico is a large furniture manufacturing location in North America. Guillermo handling his small business about...
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...Instructor Guide CORPORATE FINANCE COURSE NUMBER: MBA591 [pic] Jones International University®, Ltd. 1.800.811.JONES (5663) http://www.jonesinternational.edu ©2008 Jones International University®, Ltd. All rights reserved. 9697 East Mineral Avenue, Englewood, Colorado 80112, USA This workbook and all accompanying audio-visual material, manuals and software (collectively, the "Materials") are copyrighted with all rights reserved. Under the copyright laws, none of the Materials may be copied in whole or in part without prior written consent of Jones International University®, Ltd. (JIU™) You may permanently transfer all of your rights in the Materials, provided that you retain no copies, and provided that you transfer all of the Materials (including all component parts, media, documentation and any prior versions and upgrades). You may not copy or allow any copies of the Materials to be made for others, whether or not you charge anyone else for the copies. Limitation of Liability. JIU™ PROVIDES ALL OF THE MATERIALS “AS IS” WITHOUT WARRANTY OF ANY KIND. EACH OF JIU AND ALL ITS DEVELOPERS, TEACHING FACULTY, DIRECTORS, OFFICERS, EMPLOYEES OR AFFILIATES DISCLAIM ALL OTHER WARRANTIES, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT WILL JIU OR ITS DEVELOPERS, TEACHING...
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...E207 – International Finance General Motors Group Assignment 2 Group Members: Michelle Jang (MBA2016) Emanuele Torre (MBA2016) Taro Takagaki (IEP2016) Alex Yang (MBA2016) Jonathan Yeung (MBA2016) E207 International Finance: Assignment 2 Question 1. Why is GM worried about the level of Yen? According to Feldstein, what is the chain of events following a depreciation of the Yen? (He describes a chain of events (7 steps)). General Motors (GM) is worried about the underlying yen fluctuations from a number of different perspectives. A) Investment exposure – GM has a number of equity stakes in several Japanese companies as shown in the table below. As such, these represent net yen exposures. Any depreciation in the yen represents a positive movement (as of the reported figures) for GM as the yen-dominated liabilities currently exceed the yen-dominated assets. As a result, the underlying debt is easier to pay down should the yen depreciate relative to GM’s home currency (i.e. USD). Perhaps on the flip side, another potential concern for GM is the potential dividend or income stream that is paid from these affiliates. Any dividend income that is repatriated back to the U.S. office will be exposed to fluctuations in the yen exchange rates. Affiliate Fuji Isuzu Suzuki Affiliate GM Ownership Long/(Short) Stake -‐1.50 20% -‐1.02 49% -‐0.03 20% B) Commercial exposure – There is currently a forecasted receivables...
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...Running Head: Financial Concepts in Guillermo Furniture Store Scenario Financial Concepts in Guillermo Furniture Store Scenario: Discussion and Explanation Writer’s Name Course Name, Semester No, Class Level Supervisor Name August 25, 2009 Abstract Guillermo's Furniture Store Scenario provides the expedient case study for studying the concept of financial principle in the competitive economic environment. The current paper discusses the approach of financial management with correct application of ideas to create value and economic efficiency through analysis of financial transactions to establish the position of Guillermo in market. The Finance Concepts found in the Context of the Scenario Financial principles, financial markets, and business ethics form a foundation for the financial decisions that managers routinely make. Guillermo’s case study shows that the arrival of new competitor from oversees have put unexpected challenges on the financial condition of the company. The principles of finance describe typical behavior in financial transactions and provide guidance for decision making in the case of Guillermo. Competitors have advantage of applying the new technology to produce customized product with precise measurement to meet the demands of customer. Guillermo is also seeing the issue of rise in labor cost due to economic prosperity of the city. Since financial self-interest guides rational decision making, Guillermo has to reestablish its position...
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...Unit 5: Business Accounting Unit code: M/502/5415 QCF Level 3: BTEC National Credit value: 10 Guided learning hours: 60 Aim and purpose The aim of this unit is to enable learners to understand the purpose of accounting, and the associated processes and its role in the managing of a business. Learners will develop the skills and knowledge needed to understand financial information. Unit introduction Understanding how a business operates and what makes it successful, requires knowledge of the accounting process. Accounting involves recording business transactions and, this in turn, leads to the generation of financial information which can be used as the basis of good financial control and planning. Inadequate record keeping and a lack of effective planning ultimately lead to poor financial results. It is vital that owners and managers of businesses recognise the indications of potential difficulties. Remedial action can then be taken. The unit is divided into two parts. The first develops an understanding of the accounting processes necessary to provide accurate and relevant financial information. The second part covers the practical aspect of carrying out those accounting activities. Learners will be introduced to accounting terminology as they study the purpose and function of accounting and consider the various categories of business income and expenditure. It is important to know the sources of an organisation’s income and the nature...
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...Mekayla Lowe Business Case Analysis Apple dominates the tablet market with the iPad. Our client could potentially obtain newer technology, including some potential breakthrough features but so do Apple's other competitors. Thus, bringing a new tablet to market will take 12-18 months, during which Apple could release a new tablet and the competitive environment could also shift. Our client could buy analyst reports, field a survey, conduct focus groups, or even use a concept testing service to evaluate their tablet's chances. But the high potential for the market to shift makes this difficult. To truly understand whether and how to enter the market, they need to simulate how consumers would react to their product introduction based on different market scenarios. The client could maximize their chances of success by building a forecasting model that takes into account consumers' preferences for different brands and product features, as well as consumers’ informed opinions on what products they would prefer in different market scenarios. While their main objective is to decide whether to release their tablet, they really have three goals: * Understand which product features are most important to consumers * Quantify their potential market share and profit opportunity based on the current market * Understand the impact on potential market share and profit opportunity of Apple introducing a new tablet device A standard discrete choice study by using the strategy...
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