Case Questions for MGM 828‚ Fall 2012 Case 1: The Euro in Crisis a) Evaluate the European Central Bank’s (ECB) response to the financial crisis of 2008-2010. What was their analysis of the problem? b) The ECB responded less aggressively than the US Federal Reserve to the crisis. Why? c) In May 2010‚ should the ECB agree to purchase Greek sovereign debt? Case 2: Foreign Ownership of US Treasury Securities a) Why is foreign ownership of US Treasury securities rising? It is more interesting
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A Mini Case of Little Stone Comapny Question-1 Big Rock Corporation (BRC) announces a tender offer for all the shares of Little Stone Company (LSC) for $16 per share. The pre-announcement (one month before) price of LSC was $12. LSC stock quickly rose to $15.50. Previous similar acquisitions by peers paid an average premium of 20%. Financial information on Little Stone Company: Beta 1.5 Stock market risk premium 11% Risk free rate 3% Current interest rate on debt 15%
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Robin Chase Antje Danielson CEO and cofounder VP of environmental affairs and strategy and cofounder • MBA at MIT and substantial business experience • House-mother • Ph.D. geochemist who supervised undergraduate energ y policy research at Harvard • House-mother Our mission: Our goal is to provide reliable and convenient access to on-demand transportation‚ complementary to other means of transport. ELEVATOR PITCH (6) Financial plan: EBIT for Boston $1‚053‚68 Pay Back
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Solutions to Textbook Answers Chapter 1 Introduction Solutions to questions 1. Finance involves three main areas—corporate finance‚ financial institutions and markets‚ and investments—that are closely related and complementary. For example‚ in corporate finance the central issues are how to acquire and employ or invest funds. To acquire funds a financial manager must deal with financial institutions‚ so some knowledge of the operations of financial institutions and markets is essential. Similarly
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Solutions and Activities to CHAPTER 13 SOCIAL SECURITY Questions and Problems 1. The government of Westlovakia has just reformed its social security system. This reform changed two aspects of the system: (1) It abolished its actuarial reduction for early retirement‚ and (2) it reduced the payroll tax by half for workers who continued to work beyond the early retirement age. Would the average retirement age for Weslovakian workers increase or decrease in response to these two changes
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Case solution: Ethical Dilemma What course themes do you see present in the case? Experimental exercise Who Can Catch a Liar is about emotional intelligence and its effect on the productivity of the workers at workplace. Human have inherited the ability to respond various stimulus differently. Being differs from each other in terms of their personality‚ behavior‚ needs‚ wants‚ demands and expressing their emotions at different situation. Emotional intelligence is the ability of the person to know
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Club Med (A) HBS Case- Strategic Audit in 1986 Club med provides cheap all inclusive and social holidays for costumers. These holidays are cheaper than what the customer could replicate by himself. The accommodations are simple‚ but localised in attractive holidays places. Everything is organised in order for the consumer not to spend any money outside the «club med village ». - Financial aspects: It is the 9th largest hotel company in the world. The stock was favorite on several Wall street
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Solution: Moving from “make do” to “can do” Meeting SUBWAY’s expectations meant IPC needed topnotch management of key issues: Card programs: A newly implemented Gift card program – and management of an existing loyalty card program – brought high customer demand for IPC to handle card issues and placed a serious burden on them to respond efficiently. Customer service: Efforts to address issues were being duplicated and the process was managed manually. There was no real control of customer
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change in the value of equity. (h) What would be the impact on M. Match Ltd’s risk exposure if its liabilities paid semi-annually as opposed to annually? Q.3 An insurance company issues a $100‚000 one-year bond paying 7% annually in order to finance the acquisition of a $100‚000 one-year corporate loan paying 9 % semi-annually. (a) What is the insurance company’s maturity gap? What does the maturity model state about interest rate risk exposure given the insurance company’s maturity gap?
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The Venture Capital Division of Boeing has four projects on the table with three additional leverages of debt. As the financial analyst for the division I was given the task of evaluating the four capital budgeting projects. After evaluating each project I will recommend which project will bring the most value to shareholders and the firm. What is the cost of equity for each project at 0‚ 20%‚ and 50% leverage? From the information provided the cost of equity at 0‚ 20%‚ and 50% leverage was
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