First and most importantly, in the case of Bangladesh, it is of rationalised governance. The corporate model of the exchange under demutualised structure will enable management to take actions that are in the best interests of customers and the exchange itself. With the separation of ownership and trading privileges, an exchange will achieve greater independence from its members with respect to its regulatory functions. There will be the requisite degree of transparency. Demutualised exchanges will
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capital structure strategy employed by Leighton Holdings Ltd during the Global Financial Crisis (GFC) and also an assessment of optimal capital structure Leighton should use to fund future investments. Examination of the changes of the capital structure of the company over pre-GFC and post-GFC period (2004-2010) reveals a range of considerations were deliberated in the financing decision; these include not only the capital market conditions but also the size and urgency of funding required as well as
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set up for the long term, WACC and its associated methods might be an acceptable approximation. However, the situation is different in a considerable number of instances: The weighted average cost of capital (WACC) is a common topic in the financial management examination. This rate, also called the discount rate, is used in evaluating whether a project is feasible or not in the net present value (NPV) analysis, or in assessing the value of an asset. Previous examinations have revealed that
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Lecture 1 Capital Market and Long Term Finance * Capital Formation (Raise capital to increase their assets and fund working capital) * Markets * Common Stock (long-term security) * Bonds (long-term security) * Derivatives (long-term security) Financial Markets * Exchanges * Specialists (NYSE has SPECIALISTS maintain an orderly market in a stock at a trading station) * Intermediary Firms (NASDAQ has INTERMEDIARY FIRMS maintain a market for a given share * Publicly
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and the markets. 2) To raise money through the issuance and sale of debt and/or equity. Efficient Market: Market where all pertinent information is available to all participants at the same time, and where prices respond immediately to available information. Stock markets are considered the best examples of efficient markets. Primary Market: 1) Market in which buyers and sellers negotiate and transact business directly, without any intermediary such as resellers. 2) Financial market in which
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which is greater than the minimum acceptable hurdle rate. Hurdle Rate = Risk-Free Rate + Risk Premium Beta of a security or a portfolio helps in analyzing the volatility or systematic risk of the particular stock or portfolio in relation to the market as a whole. The value of the Beta is used in The Capital Asset Pricing Model (CAPM). The CAPM is a model which helps in understanding the relationship between the expected return and risk of a security or a portfolio and thus helps in the pricing
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shall be tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The following are examples of such events or changes in circumstances: * a. A significant decrease in the market price of a long-lived asset (asset group) (Maybe address d,e,f,g, say they are not applicable to this situation, but say a is sufficient enough to address the issue) In the case, it states that “In December 2010, one of Ida’s competitors sold its
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27 THE BASIC TOOLS OF FINANCE WHAT’S NEW IN THE SIXTH EDITION: There are two new In the News boxes on “A Cartoonist’s Guide to Stock Picking” and “Is the Efficient Markets Hypothesis Kaput?” LEARNING OBJECTIVES: By the end of this chapter, students should understand: the relationship between present value and future value. the effects of compound growth. how risk-averse people reduce the risk they face. how asset prices are determined. CONTEXT AND PURPOSE: Chapter 27 is the
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Urban Outfitters (In Thousands) Profitability: Gross Margin =37% Activity: Payable Turnover= 28.2 Leverage: Debt to Assets= 0.25 Liquidity: Current= 3.5 Market: Book Value per Share= 0.009277 Gap (In Millions) Profitability: Gross Margin= 65% Activity: Payable Turnover=13.6 Leverage: Debt to Assets= 0.61 Liquidity: Current= 1.76 Market: Book Value per Share= 0.00625 Urban Outfitters is an average profitable company with a gross margin of 37% where Gap’s is above average at 65%. Gap’s
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capital, the expected excess market return is equal to the: a. return on the stock minus the risk-free rate. b. difference between the return on the market and the risk-free rate. c. beta times the market risk premium. d. beta times the risk-free rate. e. market rate of return. Difficulty level: Easy CHARACTERISTIC LINE c 3. The best fit line of a pairwise plot of the returns of the security against the market index returns is called the:
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