Financial Management Agenda 1. What is the WACC and why is it important to estimate a firm’s cost of capital? Do you agree with Joanna Cohen’s WACC calculation? Why or why not? 2. If you do not agree with Cohen’s analysis‚ calculate your own WACC for Nike and justify your assumptions. 3. Calculate the costs of equity using CAPM‚ the dividend discount model‚ and the earnings capitalization ratio. What are the advantages and disadvantages of each method? 4. What should Kimi Ford recommend regarding
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Marriot Case Marriot use the Weighted Average Cost of Capital to estimate the cost of capital for the corporation as a whole and for each division‚ and the hurdle rate is updated annually.(WACC = (1-Tc) * (D/A) * R[D] + (E/A) * R[E]) Marriot’s Tax Bracket = 175.9/398.9 = 44% Division’s asset weight to the corporation: Lodging = 2777.4/4582.7 = 0.59 Contract = 1237.7/4582.7 = 0.28 Restaurant = 567.6/4582.7 = 0.13 Risk free rate is 30 years T-Bond = 8.95% (Lodging use long-term debt)
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0.28 0.48 0.42 Target D/D+S Target D/S Levered Beta 74% 2.85 1.62 Costs of Equity: Rf Lodging MRP 8.95% 7.43% Beta Requity 1.62 21.02% Costs of Debt: Rf Lodging 8.95% Spread Tax rate Rdebt(1-T) 1.10% 0.44 0.0563 WACCs: Lodging Target D/D+S Rdebt(1-T) S/D+S Requity WACC 74% 0.0563 26% 21.02% 9.63% Page 1 Sales Weighted Levered Beta 1.56
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Risk – Free Rate 3% + Beta Coefficient .36 Market Risk Premium 8% Cost of Equity 5.88% + Risk - Free Rate 3.% Weighted Cost of Equity 3.52% X Percentage of Total Capital Supplied by Equity 60% + Before Tax Cost of Debt 5.66% WACC 5..00% Weighted Cost of Debt 1.53% Before Tax Operating Profit in % 100% After Tax Cost of Debt 3.83% X X After Tax Operating Profit in 67.6% 40% of Total Capital Supplied by Debt 40% - Income Tax Rate 32.4% Rate of Return of
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Bridie Dunn Teacher Advanced Placement Language and Composition 25 August 2014 1984 Essay In the novel “1984” written by George Orwell the main character‚ Winston Smith‚ states that one man can control another by “making him suffer” (266). The Party in this novel is able to maintain control over its citizens by making them suffer both mental and physical torture. The mental torture of party members is very present throughout this novel. In this futuristic setting‚ a new language‚ Newspeak
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buybacks and strong dividends. About 43.8% of the total capital of the company comes from debt and the remaining comes from equity. The cost of the different components of its capital structure are – debt: 2.92% (after-tax cost)‚ and equity: 9.49%. The WACC is 6.61%‚ based on the capital structure outlined. The effective tax rate is 35.4%. AT&T has had dividend growth for the last 25 years. The dividend growth this year was 2.5% and the last year was 12.7%. Dividends declared totalled $1.61 per share
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I believe the new food label is a good approach to help many Americans to make better eating choices‚ and understand more clearly about the products around them. I do not use food labels everyday‚ but there’s have been times when i would read my food labels and not understand exactly everything. The pros of the new food labels is that the amount of calories will be bold‚ and this is a good idea to catch people’s eye. Also‚ it will be easier for people to keep track of their daily intake calories
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world has created labels for everybody‚ not only for the way you look‚ or dress but from the place you come from. Sometimes society can be rude for the way it refers to a group of people‚ however that is not the worst things. We are the society‚ we are all those people who judge‚ who label and sentences different races of people just because of their culture. Yes‚ labels can be also good but as Eleva Longoria mentioned‚ What happens when they are used in a negative way? Labels should be a way to
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Warning Labels Sergio Mansilla Devry University People know what are they exactly they are eating? No because there is no warning labels in the food packages. Same may oppose my position. To argue that warning labels are necessary for fast food. It would cause consumers to think twice before they decide to eat fast food. However‚ my research has says warning labels should be on food and help people understands what they are eating. “Americans continue to face many challenges as they debater
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reflects our tendency and willingness to find illness where there may be simple difference.” Labels can either serve to benefit or threaten a child’s learning experience. People neglect to realize that a child’s experiences or buildup of stress may have been brought on by a learning disability. I believe that children should not be labeled by their exceptionalities or disabilities‚ because that label comes with the stigma of being considered deficient or different than everyone else. Parents
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