Financial Management TA Mid-term Exam March 27‚ 2012‚ 9:3o - 11:00 1. True or False Comment on the correctness of the following statements with maximum 5 lines each. (20%) a) The IRR is larger than the discount rate if the NPV>0 False‚ there are projects with more than one IRR where the statement is not true and there are projects that have the inflow now and the outflows in future years where this relation is inversed. b) Yield to maturity is not a valid measure of expected return for a zero
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Lucas Krause Krause 1 AoS CA 38 Collage Writing Mrs. Ryn There is no I in team As average American individuals‚ we live exceptionally busy lives. Every day‚ it is easy to find ourselves caught up in a parade of unexpected events. Between work‚ school and parenting; It’s not hard to become overwhelmed. Luckily‚ numerous companies offer services in attempt to save some time and stress. There are day care programs that look after our children‚ do our yard work and even clean
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Mini Case Chapter 3 A. Ratios are used to standardize numbers‚ facilitate comparisons‚ and highlight both weaknesses and strengths. In addition‚ ratios are important profit tools in financial analysis that help financial managers implement plans that improve profitability‚ liquidity‚ financial structure‚ reordering‚ leverage‚ and interest coverage. Managers use ratios to help them effectively run the business. Creditors use ratios for risk analysis. Equity investors use the ratios for
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The Body Shop International PLC 2001: An Introduction to Financial Modeling The following graph presents the forecast for the Body Shop’s income statement and balance sheet in 2002 to 2004: How did you derive your forecast? Why did you choose the “base case” assumptions that you did? The forecast takes into considerations the stated business objectives of the Body Shop as well as trends or patterns in the historical financial statement in exhibit 8. Further information on the calculations and
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liabilities and equity | $450 | Income Statement Year 2010 | | | Net sales | $795 | Cost of goods sold | 660 | Gross profit | 135 | Selling expenses | 73.5 | Depreciation | 12 | EBIT | 49.5 | Interest expense | 4.5 | EBT | 45 | Taxes (40%) | 18 | Net income | 27 | 1. Calculate the following ratios AND interpret the result against the industry average: Ratio | Your Answer | Industry Average | Your Interpretation (Good-Fair-Low-Poor) | Profit margin on
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Chapter 12 Capital Structure and Leverage LEARNING OBJECTIVES After reading this chapter‚ students should be able to: • Explain why capital structure policy involves a trade-off between risk and return‚ and list the four primary factors that influence capital structure decisions. • Distinguish between a firm’s business risk and its financial risk. • Explain how operating leverage contributes to a firm’s business risk and conduct a breakeven analysis‚ complete with
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the pro forma ratios for the company. The finance.yahoo.com website was used throughout this report as well. We found the Dividend growth rate to be 15.95%. The Tax rate-34% was calculated by dividing the company’s income tax expense ($7‚145) by EBT ($20‚898) for 2009. We forecasted the financial statements for Wal-mart for 2010 using ratios and their past years financial statements. After all of that was done we were able to calculate the FCF for 2010 to be $5‚298. WACC calculation To estimate
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It seemed that the board of directors at MCI was divided between two possible solutions. Should the company finance the repurchase by increasing MCI’s debt financing by at least doubling the current debt-equity ration that stood at 36% at that time (MCI)? Conversely‚ would a more conservative approach of using an open-market purchase program‚ announcing its intentions to repurchase its stock from "time to time" but only as corporate funds become available‚ be more appropriate (MCI)? The answer to
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NOTES TO STUDENTS |Unit Title: |Tutor’s Name: | | | | |Unit 02 – Computer Systems |Mr. K.Akilan | |Assignment Title & Number:
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Managerial Economics Market Analysis Report – Cruise Sector Blue Group #9 Matteo Tuninetto Frosina Bollo Antonio Marchitelli Anna Rottmayr ME – Market Analysis Report Blue Group # 9 Page 1 of 14 Content 1. Market definition 3 2. Cost structure 3 2.1. Capex vs. Opex 4 2.2. Fixed vs. variable costs 5 2.3. Entry costs 6 3. Demand drivers 7 3.1. Purchase decisions 8 3.2. Trends in demand that affect revenues 8 4. Competitive situation 9 4.1. Market Concentration 10 4
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