CORPORATE FINANCE 307 LITERATURE REVIEW Student Name / ID: Chay Yu Xi 15907811 Jacqueline Teo Hui Yun 15805054 Ting Heng Huat 14973837 Tutor: Leo Kee Chye Tutorial Day / Time: Monday / 2pm Table of Contents Abstract The Tech Bubble Introduction Lowering of Interest Rates Adjustable Rate Mortgage Securitization Mortgage Backed Securities Collateralized Debt Obligation Credit Default Swap Government Reaction and Policies Emergency TARP Repercussions
Premium Subprime mortgage crisis Mortgage
$251 million After-tax WACC = (1-0.3)(0.0348 x 44/251 + 0.0618 x 1.2/251) + 0.0907 x 205.8/251 After-tax WACC = 0.0789 Calculate the RV Division WACC using Stephens’s method in paragraph 20. rE = rf + βequity(rm – rf) rE = 0.0421 + 2.1(0.06) rE = 0.1681 Using TRUST’s debt-to-equity mix of 21%: Pre-tax divisional WACC = 0.1442 = (rD x 0.21) + (0.1681 x 0.79) From above: rD = 0.0543 After-tax divisional WACC = (1-0.3)(0.0543 x 0.21) + (0.1681 x 0.79) After-tax divisional WACC
Premium Free cash flow Discounted cash flow Cash flow
CHAPTER 19 FORMATION AND TERMS OF SALES CONTRACTS Outline I. Introduction The Uniform Commercial Code was prepared to simplify and modernize the rules of law governing commercial transactions. A. Sale of Goods Article 2 applies to all contracts for the sale of goods. Some contracts are "mixed" (include both sale of goods and provision of services). In this case‚ the test is "which predominates." Example: Heart of Texas Dodge‚ Inc. v. Star Coach L.L.C.: The customization
Premium Contract Contract law
Principles of Banking and Finance: Single Cashflow 1. Present Value (PV) * the value on a given date of a payment or series of payments made at other times (past or future) * Discounting from the future * Value at t=0 on a given time line (“t” is the period‚ ranging from 0 to n where “n” being the last period). * Net Present Value (NPV): PV after deducting all the costs 2. Future Value (FV) * The amount to which a specific sum and /or series of payments will grow on a given
Premium Time Time value of money Future
questions‚ 1 points each‚ 10 points total) 1) According to M&M Theorem in the absence of corporate taxes‚ an increase in leverage (i.e.‚ an increase in D/E ratio) will lead to a) Higher cost of equity b) Low cost of equity c) No change in cost of equity d) The information provided is not sufficient to chose any of the above questions Ans: A 2) According to M&M Theorem in the absence of corporate taxes‚ an increase in leverage (i.e.‚ an increase in D/E ratio) will lead to a) Higher
Premium Stock Stock market Debt
Principles of Finance Notes Theory Questions Explain why the NPV approach is preferred to the IRR approach (2006) The NPV approach takes into account the timing of cash flows and the IRR does not. For example if you took 2 projects that required the same initial outlay and had the same cash inflows for the same period of time but one project was deferred for one year‚ using the NPV we would have different values but the IRR would give us the same. The NPV approach takes into account the scale of
Premium Finance Corporate finance Net present value
MAF302 Corporate Finance Study Guide Important Instruction This study guide provides you of an overview for each of the topic taught in this unit. These overviews however are not sufficient to learn all the materials in each of the topic. I therefore would suggest you to follow the materials in lecture notes and workshops. It is also essential to read and consult the corresponding text book chapters to develop your concept and knowledge in this unit. You will also find some references
Premium Corporate finance Net present value Option
Chapter 20 Notes Personal selling – two way flow of communication between buyer and seller Sales management – involves planning the selling program and management of sales team 20% of CEOs in the largest U. S. corporations have significant sales experience in their work history. Personal selling serves three major roles: 1. they are critical link between firm and its customers‚ 2.Salespeople ARE the company in customer’s eyes 3. Plays a dominate role in marketing program Relationship selling
Premium Sales
CASE STUDY ON CASH BUDGETING Party Favours Limited (PFL) distributes party supplies and novelties through a network of independent‚ dedicated sales people across Canada. PFL plans to expand its network of sales distribution network into western Canada and consequently forecasts sales to total $5.6 million and $5.8 million in calendar years 2011 and 2012 respectively. PFL has been in operation for over ten years‚ and therefore has a strong understanding of the seasonal sales cycle that party
Premium Operating expense Expense Capital expenditure
CORPORATE FINANCE – CONCEPT QUESTIONS Class Notes - Introduction to Corporate Finance 1. Finance point of view: Corporation: a money processing machine? * Product markets: everything what corporates make (lead with customers‚ suppliers‚ labor) * Capital markets: generic term for the entities which supply cash to this money processing machine‚ and the processing machine uses the money to do things and then periodic sends money back to the capital market there are inflows from the
Premium Net present value Internal rate of return Time value of money