|Tata Group: Transforming the Sleeping Elephant | |-- Subir Sen Faculty Member‚ | |IBS‚
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Finance 301 1. The NPV for the truck and the pulley are $2026.75 and $5586.05 respectively. Since these projects are independent‚ the company can choose either project. They both will give the company a return higher than 12% as well. (Math is on last page) 2. A. NPV for Alt A is $1892.17 while the payback is 2.86 years. NPV for Alt B is 2289.66 while the payback is 4.62 years. (Math on last page) B. Since these projects are mutually exclusive only one can be chosen. Since NVP is a better
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Investment banks provide a wealth of critical services to our economy. One important role of the investment bank is to assist public and private corporations in raising funds in the capital markets. A second service is in providing strategic advisory services for mergers‚ acquisitions and other types of financial transactions. They also act as intermediaries in trading for clients. Investment banks differ from commercial banks‚ which take deposits and make commercial and retail loans. The focus of
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PV = C / (r – g) PV = $175‚000 / (.10 – .035) PV = $2‚692‚307.69 It is important to recognize that when dealing with annuities or perpetuities‚ the present value equation calculates the present value one period before the first payment. In this case‚ since the first payment is in two years‚ we have calculated the present value one year from now. To find the value today‚ we simply discount this value as a lump sum. Doing so‚ we find the value of
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Case Study –Nike‚ Inc.: Cost of Capital FIN202a-Spring 2011 1. Please define Weighted Average Cost of Capital (WACC). Write down the WACC formula‚ and discuss its components. WACC (Weighted Average Cost of Capital) is a market weighted average‚ at target leverage‚ of the cost of after tax debt and equity. It is a critical input for evaluating investment decision‚ and typically the discount rate for NPV calculation. And it serves as the benchmark for operating performance‚ relative to
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Growth of small businesses has been rapid in most of the economies and this had been possible in the past couple of decades. About 30 years ago observers said that by year 2000 large businesses will be the main driving force in the economy and there won’t be any room for small businesses. The fact is that small businesses are the backbone of the developed and developing economies. For example: - In USA small businesses represents 99.7% of all employers‚ it represents 26% of America’s exports and
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| | | |Wednesday 2:10-5:10pm | Professor Yegmin Chang Department of Business Administration Office: 1012 Comm Bldg Phone: x-81012 Email:
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Case Solutions Corporate Finance Ross‚ Westerfield‚ and Jaffe 9th edition CHAPTER 2 CASH FLOWS AT WARF COMPUTERS The operating cash flow for the company is: (NOTE: All numbers are in thousands of dollars) OCF = EBIT + Depreciation – Current taxes OCF = $1‚332 + 159 – 386 OCF = $1‚105 To calculate the cash flow from assets‚ we need to find the capital spending and change in net working capital. The capital spending for the year was: | |Capital spending
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(3-1) Greene Sisters has a DSO of 20 days. The company’s average daily sales are $20‚000. What is the level of its accounts receivable? Assume there are 365 days in a year. AR = $400‚000 (3-2) Vigo Vacations has an equity multiplier of 2.5. The company’s assets are financed with some combination of long-term debt and common equity. What is the company’s debtratio? D/A = 60% (3-3) Winston Washers’s stock price is $75 per share. Winston has $10 billion in total assets. Its balance sheet shows
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FIN 327 Spring 2012 Project 2 U.S. Treasury Quotes Due: Feb 13‚ 2012 1. Go to the Wall Street Journal webpage http://online.wsj.com/mdc/public/page/2_3020-treasury.html?mod=topnav_2_3000 and find out the ask/bid price quotes and asked yields for treasury bills (1) maturing on 2009/09/24‚ traded on 2008/09/24 Bid = 1.845 Ask = 1.835 Asked yield = 1.887 (2) maturing on 2010/09/23‚ traded on 2009/09/24 Bid = 0.385 Ask = 0.378 Asked yield = 0.384 (3) maturing on 2011/09/22‚ traded
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