Executive Summary: The purpose of this paper is to identify the weighted average cost of capital (WACC) in relation with the firm value. Also‚ there are some aspects discussed in the paper regarding when a firm should accept a project and when to reject. Systematic risk will be also discussed in the paper concerning their target market and how risky is that. Finally‚ the approach that BlackBerry took into consideration to overcome their risk. Discussion: All companies’ assets are financed by
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Every coin has two sides. After the merger‚ both companies encountered several problems during their integration. Next‚ I will go into details about issues they faced. First of all‚ they wanted to further solidify their brand presence. Fiat has been successful in the European market but lacks visibility in North America; while Chrysler does not carry a strong dealer network in the European markets. What’s worse‚ historically‚ Chrysler was referred to the “Number Three” auto manufacturer and even
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Bonds Microsoft’s long-term debt is composed of eight long-term bonds. It also has two short-term bonds that mature this year and early next year. These bonds were neglected in this report. In this report the required return was calculated by using the coupon rates‚ market values‚ time until maturity‚ and tax rate. These values were all found on Microsoft’s 2012 financial statement. The weighted average cost of debt was then found through the multiplication of each bond’s required return and their
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its cash flow therefore it is a way to; a) Evaluate the Investment Decision b) Decide on a debt policy c) Appraise the performance of top managers 2) Compute the corporate WACC. Be sure to state all your assumptions to get the various inputs to the WACC. r_e=r_f+ β(EMRP) WACC= r_e (E/V)+ r_d (D/V)(1-t) E=Midland’s Equity Market Value D=Midland’s Net Debt (E/V)= Weight for the cost of equity (D/V)= Weight for the cost of V (E+D)= Midland’s total Market Value
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Road Test – Fiat Abarth Punto Title: Prioritising Performance with Fiat Abarth Punto Meta Description: Remarkable driving dynamics with 145 bhp churning turbo petrol engine and a well weighted steering make Abarth tempting for petrolheads. Description: The bespoke Abarth Punto is for the performance enthusiasts. Combination of ride and handling is remarkable and the solid build quality typical of European cars is evident. The vinyl design scheme is aggressive but in keeping with the nature of this
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Calculate WACC using book values: The weight of debt is calculated by adding the current portion of long-term debt‚ notes payable and long-term debt‚ and dividing it by the sum of debt and equity. $5.4 + 855.3 + 435.9 = $1‚296.6 $1‚296.6 / (1‚296.6 + 3‚494.5) = .27 = 27% The weight of equity is calculated by dividing the total shareholder equity by the sum of debt and equity. $3‚494.5 / (1‚296.6 + 3‚494.5) = .73 = 73% Cost of Debt To find the cost of debt I subtracted the tax savings from
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Fiat Group’s first-time adoption of IFRS Course: Corporate valuation Authors: Hanlin Wang David Řeha Jin Zhang Joy Nguyen On Wednesday‚ February 24‚ 2010 the SEC reiterated its support for International Financial Reporting Standards (IFRS)‚ this was conditional upon the accomplishment of a number of milestones. The SEC staff had developed a comprehensive work plan that would help to keep the process moving forward. Including Fiat‚more and more huge cooperations are adopting IFRS
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Kai Jiang Case – HBS: Fiat -- Tata Case questions: 1 What is Fiat’s current situation in India? Fiat is an Italian automobile manufacturer based in Turin. Fiat India in Indian car market is facing the dilemma of poor sales. It had a very small market share in India comparing to other existing automobile competitors. There was a good and long relationship with Tata Motors in Indian so Fiat and Tata were going to have a joint venture (JV) to manufacture passenger cars‚ engines and transmissions for
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Fiat Chrysler Q2 Earnings Group Performance: FCA has reported a positive overall financial performance for the second quarter of 2015. It earned a net profit of € 333 million that is up 69 % from Q2 2014 net profit of € 197 million. Net revenue for the group increased by 25 % from € 23.3 billion to € 29.2 billion while there was a slight reduction in net industrial debt which now stands at € 8.0 billion. The outstanding improvement in net profit and EBIT was led by a strong improvement in NAFTA
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Business Ethics Fiat Pushes Work Ethic at Italian Plant (http://www.nytimes.com/2010/07/23/business/global/23fiat.html?page (http://www.nytimes.com/2010/07/23/business/global/23fiat.html?pagewanted=all&_r=0)wanted=all&_r=0) Description The article published in the New York Times on July 22‚ 2010 emphasizes on how culture and social background influences work ethics in multinationals. As the title suggests Fiat during the first half of the year faced financial crunch and Italy as
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