Effects of working capital management on the profitability of Portuguese manufacturing firms Sónia Silva* sonia@eeg.uminho.pt Florinda Silva** fsilva@eeg.uminho.pt July 2012 Abstract This study provides empirical evidence about the effects of working capital management on the profitability of Portuguese manufacturing firms. A database covering the period 1996-2006‚ collected from Portuguese Statistical Office‚ is analyzed under panel data methodology. In line with previous research
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on a $1‚000 face value. However‚ interest is paid semi-annually. If your required rate of return is 10%‚ what is the value of the bond? How would your answer change if the interest were paid annually? 7) Sharp Co. bonds are selling in the market for $1‚045. These 15 year bonds pay 7% interest annually on a $1‚000 par value. If they are purchased at the market price‚ what is the expected rate of return? 8) You own a bond that pays $100 in annual interest‚ with a $1‚000 par value. It matures in 15
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switching costs are low between different brands of Airline‚ consumers are more likely to select well-known names of Airline companies because worth-of-month is importantly affecting Airline companies and safety is the first thing customers will consider. Since the ticket of Airline are usually expensive‚ customers would not give their money to the firms they do not trust. Secondly‚ this industry needs planes and experience of flying which also lowers the threat of new entrants. If a new firm plan to
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LECTURE STOCK VALUATION 1. Common stock valuation A share of common stock is more difficult to value in practice than a bond‚ for at least three reasons. First‚ with common stock‚ not even the promised cash flows are known in a advance. Second‚ the life of the investment is essentially forever‚ since common stock has no maturity. Third‚ there is no way to easily observe the rate of return that the market requires. Nonetheless‚ as we will see‚ there are cases in which we can come up with
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Stock exchange A stock exchange is a form of exchange which provides services for stock brokers and traders to trade stocks‚ bonds‚ and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments‚ and capital events including the payment of income and dividends. Securities traded on a stock exchange include shares issued by companies‚ unit trusts‚ derivatives‚ pooled investment products and bonds. To be able to trade a security
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Cost of Capital questions and practice problems Questions 1. What does the WACC measure? 2. Which is easier to calculate directly‚ the expected rate of return on the assets of a firm or the expected rate of return on the firm’s debt and equity? Assume you are an outsider to the firm. 3. Why are market-based weights important? 4. Why is the coupon rate of existing debt irrelevant for finding the cost of debt capital? 5. Under what assumptions can the WACC be
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T F 1. The first step in the top-down approach to stock valuation is analyzing the position of the industry in its life cycle. Answer: False T F T F T F T F T F 6. Industry life cycles measure the growth path of an industry through five stages. Answer: True T F 7. Industry life cycles predict an industry’s sensitivity to the economy. Answer: False T F 2. The method of starting the stock valuation process with an analysis of the economy is referred
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Abstract: The project is done to find out the impact of stock split on the stock market. In our project‚ we have made use of event study methodology to assess the accuracy of stock price reaction of 39 public listed Indian companies in National Stock Exchange (BSE) in the year 2006 and onwards. The abnormal returns (actual returns-returns from regression line) results were taken for 20 days before and after the announcement date to test whether the result is significant or not (Level of significance=5%)
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OF CAPITAL MARKET ON ECONOMIC GROWTH OF NIGERIA CHAPTER ONE 1.0 INTRODUCTION 1.1 BACKGROUND OF THE STUDY The capital market is a highly specialized and organized financial market and indeed essential agent of economic growth because of its ability to facilitate and mobilize saving and investment. To a great extent‚ the positive relationship between capital accumulation real economic growths has long affirmed in economic theories (Anyanwu‚ 1993). Success in capital accumulation
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will discuss the small firm effect as an anomaly which counter-argues the efficient market hypothesis in relate to the capital assets pricing model. Furthermore‚ the supporting evidence and influence of this anomaly will be included in the essay. Moreover‚ the reason of existence and profitability will be discussed. At last‚ a conclusion about whether or not to use this anomaly earn profit will be provided. Explanation of small firm effect and its methodologies Small firm effect refers to a situation
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