Comparing the responses to all these variables gives the results a more meaningful explanation because it is able to test various finance theories. The responses to the capital budgeting portion of the survey follow academic advice and use present value techniques to evaluate new projects. But when it comes to capital structure, firms rely on practical, informal rules and pay less attention to academic advice. Survey Methodology Before the surveys were sent out, they went through a series of tests
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million issued of 26 year, 16 percentage, and mortgage bonds issued in 11 months earlier. Three of the board member has taken markedly different positions. The bond has been issued the previous October, when interest rates were at their peak. At that time , Cahill and the board of director thought that interest rates were at a high and would likely decline in the future , but they had no idea that the slump would come so soon and be so sharp. Now, less than a year later, rated utility bonds such as
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® a practical guide for business calculations ALASTAIR L. DAY Alastair Day has worked in the finance industry for more than 25 years in treasury and marketing functions and was formerly a director of a vendor leasing company specializing in the IT and technology industries. After rapid growth, the directors sold the enterprise to a public company and he established Systematic Finance plc as a consultancy specializing in: • financial modelling – review, design, build and audit • training
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financial market having the same systematic risk. – required return: is from an investor's point of view – cost of capital: is the same return from the firm's point of view – appropriate discount rate: is the same return yet again to be used in a present value calculation WACC - 2 3 B. Required (rate of) Return • COMBINING BOTH INVESTORS’ AND FIRMS’ PERSPECTIVES: • A FIRMS COST OF CAPITAL OR DISCOUNT RATE IS GIVEN BY INVESTORS REQUIRED RATE OF RETURN. • RETURN TO INVESTMENT DECISION!!
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[pic] SCHOOL OF BUSINESS, ECONOMICS AND MANAGEMENT AFIN 209 - CORPORATE FINANCE AND FINACIAL MODELLING MID TERM EXAMINATION SEPTEMBER 2012 Time allowed: 3 HOURS plus 5minutes reading time Instructions to Candidates: 1. Check that you have the correct examination in front of you. 2. There are SIX (6) questions in this paper. Answer FOUR (4) questions. 3. All questions must be answered on the answer sheet only. 4. Begin each question on a new page. 5.
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| Mergers & Acquisitions | Acquisition Case Study: Amazon’s acquisition of Zappos, November 2009 | | Stephen Greening | 26/04/2014 | WORD COUNT: 2489 Contents Executive Summary 3 Introduction 4 Amazon Overview 4 Amazon’s Previous Acquisitions 5 Zappos Overview 6 Acquisition of Zappos 9 Strategy 11 Why Amazon wanted to acquire Zappos 11 Regulation 14 Valuation 15 Comparable Company Analysis (Comps)
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Investment Positive Compared to the previous group presentations, case number four is considerably distinct since the concept to be utilized in analyzing the case is foreign to the class’ current financial understanding. Specifically, the concept of time value of money was discussed in our previous class last semester while the concept of risk and return is new to everyone. Fortunately, the presenters managed to explain the topic before tackling the case, allowing the students to understand the case discussion
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| | | 4. | All of the above | | | | 5. | - | | 1. | The present value of a single future sum: | 1. | depends upon the number of discount periods. | 1 | | | 2. | increases as the discount rate increases. | | | | 3. | is generally larger than the future sum. | | | | 4. | increases as the number of discount periods increases. | | | | 5. | - | | 1. | The present value of a perpetuity decreases when the -------- decreases. | 1. | number of investment
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can you say about the company’s liquidity position in 2013? 4. Calculate the 2013 inventory turnover, days sales outstanding (DSO), fixed assets turnover, and total assets turnover. 5. Calculate the 2013 debt ratio, liabilities-to-assets ratio, times-interest-earned, and EBITDA coverage ratios. What can you conclude from these ratios? 6. Calculate the 2013 profit margin, basic earning power (BEP), return on assets (ROA), and return on equity (ROE). What can you say about these
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Response | Value | Correct Answer | Answer: | 9.80 | 100% | 9.80 | | General Feedback: | | I = | S - P | = | 1860 - 1240 | = | 620 | | | | | I = | Prt | | | 620 = | 1240 × 0.051 × t | | | t = | 620 1240 × 0.051 | | | t = | 9.8 | | Score: | 9/9 | | 2. On 7 April, Mr X borrows $1300 at 6.2% p.a. and repays on 12 November of the same year. Find the amount of simple interest paid. | | | Student Response | Value | Correct
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