The local government debt Abstract: As China’s economy has increasingly grown at an incredible high speed about average 9.8% gain every year before the 2008 financial‚ and china has became the world second-largest economy. Local government plays an important role in keeping such a rapid growth through the large amount of investment. However‚ the local government debt has increased substantially‚ following the growth of total economy. And the problems and potential troubles brought by the local
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The PIGS’ external debt problem Ricardo Cabral 8 May 2010‚ VOX.EU Markets are increasingly concerned that the Greek debt crisis could spread to other Eurozone countries including Portugal‚ Ireland‚ and Spain. This column notes that much of these countries ’ debt is held by non-residents meaning that the governments do not receive tax revenue on the interest paid‚ nor does the interest payment itself remain in the country. The solution lies with debt restructuring and rescheduling. Financial
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Accumulating too much debt can cause many future problems. Missed monthly payments on items such as bank loans and credit cards could cause a consumer to default an account. Defaulting on a loan can ruin personal credit ratings for years to come. Finding a lender for loans on homes or automobiles will be nearly impossible‚ and if someone is lucky to obtain a loan‚ hefty interest rates and larger premiums will be a haunting reminder of past mistakes. Consumers with defaulted accounts may also incur
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Debt policy at UST inc. Case To: UST Board of Directors From: UST Financial analysis team Date: 18 January 2011 Subject: Future debt policy at UST and recapitalization option 1. Analysis of UST business current and future environment UST operates in the smokeless Tobacco industry‚ a market with 2 B$ of revenues‚ which grew at a CAGR of 3.7% over the past 17 years‚ but more recently experienced a decrease in growth rate‚ dropping to 2.9% in 1997 and 1.2% in 1998. In this market‚ UST
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undergoing. Concerning the declining sales growth and gradual loss of the market share‚ UST Inc. is now considering recapitalizing by issuing debt amounts to $1 billion. By recapitalizing‚ it can create a total $380 million interest tax shield to add up firm value and‚ at the same time‚ make shareholders better off by using the proceeds from the issuance of debt to buyback outstanding shares. Although declining sales growth and litigation problem might be hidden concerns for UST Inc. ‚ after some analysis
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Deena Shalab@16457 Reem Hani Arab @16185 CASE 4 An Introduction to Debt Policy and Value 1 (Table format and content from case) 0% debt/100% equity 25%debt/75% equity 50%debt/50% equity BV of debt 0 $2‚500 $5‚000 BV of equity $10‚000 $7‚500 $5‚000 MV of debt 0 $2‚500 $5‚000 MV of equity $10‚000 $8‚350 $6‚700 Pretax cost of debt 0.07 0.07 0.07 After-tax cost of debt 0.0462 0.0462 0.0462 Market Weight of Debt 0 0.23 0.43 Market Weight of Equity 1.0 0.77 0.57 Un-levered Beta 0.8
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Albert Camus asserts that “nobody realizes that people expend tremendous energy merely to be normal.” Accordingly‚ every individual is inattentive of his or her laborious modification of behavior to remain normal as per the social standard. The act of being normal is not bounded by any particular set of guidelines as a behavior that seems ordinary to one might be deemed odd to another. Correspondingly‚ the individuals in a society follows the concept of The Generalized Other‚ in which one tries
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Date: January 30‚ 2010 Domestic Debt and the Nigerian Economy I. Adofu and M. Abula Departm ent of Eco nom ics‚ Kogi S tate University‚ A nyigba‚ Nigeria Abstract: The study investigates the empirical relationship between domestic debt and economic grow th in Nigeria. Using OLS regression techniques and the time series data from 1986 – 2005‚ the study explored the relationship betw een d ome stic deb t and economic growth in Nigeria. Our result shows that domestic debt has affected the growth of the
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value from financing strategies. If you finance with debt in a world with taxes‚ then you might add value from interest payments tax shields • Question: • If this is true for everyone‚ then why do not find more debt financing in more companies‚ i.e you find little debt in technological companies Myers and the Pecking Order • Prof. Myers found the following preferences among US and World companies for financing growth: 1. Retained Earnings 2. Debt 3. Stock issues Questions: Are retained earnings cost
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The U.S. debt is over $14.5 trillion‚ and is the sum of all outstanding debt owed by the Federal Government. Nearly two-thirds is the public debt‚ which is owed to the people‚ businesses and foreign governments who bought Treasury bills‚ notes and bonds. The rest is owed by the government to itself‚ and is held as Government Account securities. Most of this is owed to Social Security and other trust funds‚ which were running surpluses. These securities are a promise to repay these funds when Baby
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