Harvard Business School 9-289-047 Rev. April 1‚ 1998 Marriott Corporation: The Cost of Capital (Abridged) In April 1988‚ Dan Cohrs‚ vice president of project finance at the Marriott Corporation‚ was preparing his annual recommendations for the hurdle rates at each of the firm’s three divisions.部门 要求报酬率 Investment projects at Marriott were selected by discounting the appropriate cash flows by the appropriate hurdle rate for each division. In 1987‚ Marriott’s sales grew by 24% and its return on equity
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Diapers One morning‚ a Costco store in Los Angeles began running a little low on size-one and size-two Huggies. Crisis loomed. So what did Costco managers do? Nothing; They didn’t have to‚ thanks to a special arrangement with Kimberly-Clark Corp.‚ the company that makes the diapers. Under this deal‚ responsibility for replenishing stock falls on the manufacturer‚ not Costco. In return‚ the big retailer shares detailed information about individual stores’ sales. So‚ long before babies
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Case Study: Purinex‚ Inc. Introduction The case asks for evaluation of different financing options. Gilad Harpaz is Purinex’s CFO and he needs to determine which one from the three options provides lowest risk‚ highest company value‚ and short term cash for operations. Purinex is a biotechnological company that has 35 patents pending in pharmaceutical field. It is one of the raising stars that may develop new drug for specific use in diabetes and sepsis. Company has 14 employees. Monthly burden
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Debt Scenario Understanding the current reporting requirements for long-term liabilities is critical when making the decision to make sacrifices for future economic benefits. Specifically these long term liabilities consist of bonds‚ mortgages‚ capital leases‚ as well as other types of debt. Bonds are one type of long-term liability‚ which are traditionally valued at the present value of the bonds expected future cash flows‚ which are made up of both interest and principal. Bonds can be issued
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Cost of Capital Jenny Lopez-Guerrero‚ Malika Hobheidar‚ Phyllis Hebert and Sierra Harkness FIN571 February 23‚ 2015 William Stokes Cost of Capital In the Wiley plus simulation (2012)‚ we are introduced to Pfizer‚ the world ’s largest research-based pharmaceutical company‚ Pfizer develops their own pharmaceutical products. Ahmed Singh‚ a consultant accountant who works for the Pfizer Treasury Department‚ explains that his role in the company is "to think and plan
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share (P0)? b. What is Gentry’s weighted average cost of capital (WACC)? c. Gentry can increase its debt by $8 million‚ to a total of $10 million‚ using the new debt to buy back and retire some of its shares at the current price. Its interest rate on debt will be 12 percent (it will have to call and refund the old debt)‚ and its cost of equity will rise from 15 percent to 17 percent. EBIT will remain constant. Should Gentry change its capital structure? d. If Gentry did not have to refund the
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Análisis Caso Marriott Corporation: Costo de Capital En el caso se plantea que Marriott utiliza cuatro elementos en su Estrategia Financiera las cuales apuntan a un crecimiento objetivo. Por lo que‚ se pregunta‚ ¿Son consistentes estos elementos con su crecimiento objetivo?‚ y para ello se realiza el siguiente análisis. I. Análisis de los Elementos de Estrategia Financiera: Primero debemos identificar que el alto crecimiento que busca Marriott es igual a maximizar el valor de la empresa y para
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Estimating the Cost of Capital: Survey and Synthesis Case 13 Teaching Notes Introduction “Each year in the US‚ corporations undertake more than $500 billion in capital spending” (Bruner 184). This case presents a reasonably analyzed set of teaching notes describing how these financially sophisticated corporations estimate their capital costs. Understanding the estimation of capital costs helps identify the uncertainty of the cost-of-capital theory‚ sets a benchmark for cost-of-capital‚ helps
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Mercy Corps Introduction At the fourth biennial Mercy Corps leadership conference in November 2006 executive leadership described the well-known‚ internal complications at Mercy Corps as a large organization ($194 million budget in 2006) that “has to focus on two core areas: international relief and development” (Grossman & King‚ 2008). The status of the organization was examined in detail by the Harvard Business School case study and a number of problems were revealed. This analysis is based
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This article was downloaded by: [Fry‚ Jody] On: 22 November 2010 Access details: Access Details: [subscription number 918210014] Publisher Routledge Informa Ltd Registered in England and Wales Registered Number: 1072954 Registered office: Mortimer House‚ 3741 Mortimer Street‚ London W1T 3JH‚ UK Journal of Management‚ Spirituality & Religion Publication details‚ including instructions for authors and subscription information: http://www.informaworld.com/smpp/title~content=t792992301
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