CASES IN FINANCIAL MANAGEMENT SYLLABUS FIN 522 Professor James A. Gentry Cases In Financial Management 343M Wohlers Hall Spring Semester 2009 333-7995 2043 BIF j-gentry@uiuc.edu Office Hours: 10:30 a.m. to 11:45 a.m.
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Finance Mini Case a) Provide a brief overview of capital structure effects. Identify the ways in which capital structure can affect the WACC and FCF. Capital structure presents how a company finance its operations. It is expressed as percentage of debt, preferred stock, common equity used in financing a company's operations.[1] WACC calculates a company's “cost of capital in which each category of capital is proportionately weighted. All capital sources - common stock, preferred stock, bonds and
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Chapter 13 Capital Structure and Leverage LEARNING OBJECTIVES After reading this chapter, students should be able to: • Explain why capital structure policy involves a trade-off between risk and return, and list the four primary factors that influence capital structure decisions. Distinguish between a firm’s business risk and its financial risk. Explain how operating leverage contributes to a firm’s business risk and conduct a breakeven analysis, complete with a breakeven chart. Define
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CHAPTER 14 CAPITAL STRUCTURE: BASIC CONCEPTS Answers to Concept Questions 1. Assumptions of the Modigliani-Miller theory in a world without taxes: 1) Individuals can borrow at the same interest rate at which the firm borrows. Since investors can purchase securities on margin, an individual’s effective interest rate is probably no higher than that for a firm. Therefore, this assumption is reasonable when applying MM’s theory to the real world. If a firm were able to borrow at a rate lower
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STAMFORD UNIVERSITY BANGLADESH Assignment On: Capital Structure Analysis of Lafarge Surma Cement Limited Course Title: Finance Theory Course Code: FIN -608 Submit To Mohammad Salahuddin Chowdhury, ACA Assistant Professor, Dept. of Finance, University of Dhaka Submit By Md. Jahidul Islam; ID: MBA-05014570 Jabun Nahar; ID: MBA 05014443 Rajib Kumar Saha; ID: MBA 05014533 Date of submission 17th April 2013 Letter of Transmittal April 17, 2013 Mohammad Salahuddin Chowdhury, ACA Assistant
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outlined for the company. In 2000 when CPK went public, it used the proceeds to pay off its outstanding debt and avoided debt financing. Analysis Questions: 1. To improve the company’s performance they would need to restructure their working capital policy and make use of the available leverage. CPK can use debt to repurchase stock and continue to grow and increase profits. Utilizing the debt would also reduce the tax
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introduction to the Modigliani-Miller capital structure irrelevance propositions and the concept of debt tax shields. With the background of a pizza company, the case provides an engaging context to discuss the “pizza graphs” that are commonly used in corporate finance curriculum to illustrate the wealth effects of capital structure decisions. The case serves to motivate the following teaching objectives: • Introduce the Modigliani-Miller intuition of capital structure irrelevance; • Establish
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MANAGEMENT DEVELOPMENT INSTITUTE OF SINGAPORE TASHKENT INTERNATIONAL TRADE FINANCE – INDIVIDUAL ASSIGNMENT Course Module Lecturer Due Date Weightage : Bsc (Hons) in Banking and Finance : International Trade Finance : Ms Ratna Devi : 5 November 2012 : 30% Assignment —Individual This assignment for the module International Trade Finance carries 30% of the overall assessment grade. Case under Observation: This is a case study of a U.S. company called Cossco, Inc, depicted in different scenarios
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10/11/12 Du Pont Proposed Capital Structure for Du Pont Corporation Uploaded by settypr on Jun 7, 2006 | | | Proposed Capital Structure for Du Pont Corporation The Du Pont Corporation was founded in 1802 to manufacture gunpowder. After nearly two centuries of operations, the company has greatly diversified its product base through acquisitions and research and development,, and is one of the largest chemical manufacturers in the world. In 1995, Du Pont had revenues of $42.2 billion and net
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business? b. How did the Sulzberger family manage to retain control on the NYT after it went public? c. How does the NYT dual class structure differ from the one used by Dow Jones, prior to its takeover by Rupert Murdoch? d. What explains the behavior of the NYT institutional shareholders – not just Morgan Stanley but also Private Capital Management, T Rowe Price and Vanguard? e. How should Arthur Sulzberger, Jr. respond to Morgan Stanley’s proposal? 2. Valuing
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