STUDENT RESEARCH PROJECT Estimating the Cost of Capital of CNX Nifty Prepared by Bhaswar Sarkar Student of PGDM Program of 2011-2013 Xavier Institute of Management, Bhubaneswar Supervised by Dr. Shridhar Kumar Dash Professor, Accounting and Finance Xavier Institute of Management, Bhubaneswar March 2013 Estimating the Cost of Capital of CNX Nifty Prepared by Bhaswar Sarkar1 Abstract This paper calculates the cost of capital of the CNX Nifty 50 Stock Index. It explores the
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provided a copy of their last year reported annual income statement and balance sheet. (Please review appendix A and appendix B) Capital Budgeting Analysis Capital budget is the process to determine if a company is in good standing and worthy to invest in. The Stock information is detailed below (see appendix C). Currently at 15.81/share with 130,448,200 in volume. The capital budgeting for Bank of America is managed by
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MANASA KARUSALA DIVYA YEDAMA 1) What was your strategy in the classroom market? What did you think each of the assets was worth? Were you able to implement your strategy? Why or why not? Why (or why wasn't) your strategy successful? My strategy was to equalize both the red and blue assets, as it is impossible to predict before hand which asset would have more value. But I couldn’t implement my strategy, as it is not easy to maintain that equivalence especially when the entire market is active
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Investment Theory (Master course, ABS) Final Exam 2013 Your Name: Student Number: Signature: Remark: In all the questions of this exam we assume that there is no transaction cost and investors can take long and short positions in any asset without margin requirement. Part I (8 questions, 5 points each; circle one and only on choice that you think is the best. No penalty for the wrong choice.) 1. The excess return on any stock can be seen as a zero-cost gamble because a. it is highly risky,
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is not important at all? Explain your answer. (5 marks) Maximizing the shareholder’s wealth is long term process. Shareholder wealth is maximized by maximizing the difference between the market value of the firm’s stock and the amount of equity capital that was supplied by shareholders (Brigham & Ehrhardt: 2011). In order to maximize the value of the firm the managers should make all decisions to increase the total long run market value of the firm. Therefore the managers will invest in projects
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Cost of Capital Practice Problems 1. Why is it that, for a given firm, that the required rate of return on equity is always greater than the required rate of return on its debt? The required rate of return on equity is higher for two reasons: • The common stock of a company is riskier than the debt of the same company. • The interest paid on debt is deductible for tax purposes, whereas dividends paid on common stock are not deductible. 2. The Mountaineer Airline Company has consulted
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point, one point each） 1. 资本配置线可以描述为 A) 投资机会集由一个无风险资产和一个风险资产构成 B) 投资机会集由两个风险资产构成 C) 上面每个点对某个投资者来说效用都一样 D) 每个点期望收益一样但风险不一样 E) 上面一个都不对 1. The Capital Allocation Line can be described as the A) investment opportunity set formed with a risky asset and a risk-free asset. B) investment opportunity set formed with two risky assets. C) line on which lie all portfolios that offer the same utility to a particular investor. D) line on which lie all portfolios with the same expected rate
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EXECUTIVE SUMMARY This report analyse the case of Dimensional Fund Advisors (DFA) which is an investment firm in Santa Monica, California. In 2002, David Booth is in dilemma considering how should he lead DFA in the future considering current success condition DFA could achieved. The aim of this report is to assess the condition and situation of DFA and help David Booth in making decision as to what to do to excel DFA performance. This report is divided into 5 parts starting from the company background
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Brocoum Courtney Delia Stephanie Doherty David Dubois Radu Oprea October 15th, 2009 Contents Objectives 1 Management Summary 1 Cost of Equity 1 Equity Market Risk Premium 1 Beta 2 Risk Free Rate 2 Capital Structure Weights 2 Boeing 7E7 Project Evaluation 4 Circumstances for an economically attractive project 4 Market Demand 4 Market Share 4 Sensitivity Analysis 4 Conclusion 7 Board approval for the project? 7 Appendices 7
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interactions with investors. Essential in most of these decisions is the process of valuation, which will be emphasized throughout the course. Topics include criteria for making investment decisions, valuation of financial assets and liabilities, relationships between risk and return, capital structure choice, payout policy, the effective use and valuation of derivative securities (futures, options), and risk management. 1 COURSE MATERIALS Textbook The textbook for the course is: Corporate Finance
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