BUS 650 Entire Course (new)
BUS 650 Entire Course (new)
BUS 650
Entire Course (new)
This package includes 2 version/ 30 files
VERSION 1
BUS 650 Week 1 DQ 1 The Role of
Financial Management in a Firm
BUS 650 Week 1 DQ 2 Short Term
or Long Term View
BUS 650 Week 1 Financial
Management Challenges
BUS 650 Week 2 DQ 1 Initial
Investment
BUS 650 Week 2 DQ 2 Managing
Earnings
BUS 650 Week 2 Return on
Investment Education Funding
BUS 650 Week 3 DQ 1 GAAP vs.
IFRS
BUS 650 Week 3 DQ 2 Capital
Rationing
BUS 650 Week 3 Journal Capital
Budgeting
BUS 650 Week 3 Management of
Working Capital Case Study Georges Team
BUS 650 Week 4 Assignment Types
of Risk
BUS 650 Week 4 DQ 1 Applying
the Capital Asset Pricing Model (CAPM)
BUS 650 Week 4 DQ 2 Risk
Identification and Mitigation
BUS 650 Week 5 Comparing
Capital Expenditures
BUS 650 Week 5 DQ 1 Factors in
Capital Budgeting Decisions
BUS 650 Week 5 DQ 2 Assessing
Dividend Policy
BUS 650 Week 5 Journal Capital
Budgeting and Dividend Policy
BUS 650 Week 6 DQ 1 Comparing
Financial Ratios
BUS 650 Week 6 DQ 2 Potential
Issues in Ratio Analysis
BUS 650 Week 6 Final Paper
Financial Analysis The LG group
BUS 650 Week 6 Final Paper Pro
Forma financial statements
VERSION 2
BUS 650 Week 1 Assignment
BUS 650 Week 1 DQs
BUS 650 Week 2 Assignment
BUS 650 Week 2 DQs
BUS 650 Week 3 Assignment
BUS 650 Week 3 DQs
BUS 650 Week 4 Assignment
BUS 650 Week 4 DQs
BUS 650 Week 5 Assignment
BUS 650 Week 5 DQs
BUS 650 Week 6 Final
Assignment
BUS 650 Week 6 DQs
Scroll down for more details
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VERSION 1
The Role of Financial
Management in a Firm. Examine the role of
management as it relates to finance in a corporation. In your post, discuss the
role of management by addressing the following prompts:
Explain the various aspects of
finance that management must understand.
Describe why a manager needs to
understand the characteristics and importance of financial markets including
their liquidity, competitiveness, and efficiency.
Interpret the function of the
Financial Balance Sheet in assisting in management’s decision making process.
Discuss what could happen if
management does not fulfill responsibilities related to finance. Share a real
world example from your own professional experience or from an external source.
Your post should be 200-250
words in length.
Short Term View or Long Term
View? After reading the first two chapters of your
textbook, evaluate the following statement:
Managers should not focus on
the current stock value because doing so will lead to overemphasis on
short-term profits at the expense of long-term profits.
In your post, explain what is
meant by this statement. Describe how management might decide whether to focus
on short term or long term goals and how that decision impacts the
organization. Next, using the financial balance sheet as displayed in the text,
compute an example of how focusing on short term profits can be detrimental to
long term profits. Share your opinion regarding whether you feel it’s a better
option to focus on short term or long term goals. Use evidence from the text or
external sources to support your position. Your post should be 200-250 words in
length.
Financial Management Challenges. The following video discusses the four types of markets: perfect
competition, monopolistic competition, oligopoly, and monopoly.
Video 2.1: Market Structures
Given the market structures as
described in the video, find at least two articles from the ProQuest database
that highlight and discuss two of the biggest challenges facing financial
managers today in these varied market structures. Summarize your findings from
the articles in a three to five page paper excluding title page and references
page(s). Include how market liquidity, competitiveness, and efficiency impact
financial managers.
The paper should be formatted
according to APA style as outlined in the Ashford Writing Center. Be sure to
properly cite your resources using APA style.
Initial Investment. After reading Chapters 3 and 4 of your textbook, address each of
the following questions:
a) Think of something you want
or need for which you currently do not have the funds. It could be a vehicle,
boat, horse, jewelry, property, vacation, college fund, retirement money, etc.
Select something which costs somewhere between $2,000 and $50,000. Use the
“Present Value Formula”, which computes how much money you need to start with
now to achieve the desired monetary goal. Assume you will find an investment
that promises somewhere between 5% and 10% interest on your money (you choose
the rate) and pretend you want to purchase your desired item in 12 years.
(Remember that the higher the return, usually the riskier the investment, so
think carefully before deciding on the interest rate.) How much do you need to
invest today to reach that desired amount 12 years from now?
b) You wish to leave an
endowment for your heirs that goes into effect 50 years from today. You don’t
want to be forgotten after you pass so you wish to leave an endowment that will
pay for a grand soirée yearly and forever. What amount would you like spent
yearly to fund this grand party? How much money do you have to leave to your
heirs 50 years from now assuming that will compound at 6% interest? Assuming
that you have not invested anything today, how much would you have to invest
yearly to fully fund the annuity in 50 years, again assuming a 6% monthly
compounding rate?
Managing Earnings. Companies often try to keep accounting earnings growing at a
relatively steady pace in an effort to avoid large swings in earnings from
period to period. They also try to manage earnings targets. Reflect on these
practices and discuss the following in your discussion post.
Are these practices ethical?
What are two tactics that a
financial manager can use to manage earnings?
What are the implications for
cash flow and shareholder wealth?
Using the financial balance
sheet as displayed in the text, provide an example of how purchasing an asset
or issuing stocks or bonds could potentially impact earnings targets.
Return on Investment –
Education Funding. Develop a three to five page
analysis on the projected return on investment for your college education and
projected future employment. This analysis will consist of two parts.
Part 1: Describe how and why
you made the decision to pursue a MBA. Include in that explanation calculations
of expenses and opportunity costs related to that decision.
Part 2: Conduct research on
your desired occupation and how much compensation (return) you expect to earn.
How long will it take to pay back the return on this investment? Be sure to use
the financial formulas (Net Present Value (NPV), Internal Rate of Return (IRR)
and Payback) provided in Chapters 3 and 4 of your text.
The analysis should be
comprehensive and reference specific examples from scholarly sources. The paper
should be formatted according to APA.
GAAP vs. IFRS. The United States uses Generally Accepted Accounting Principles
(GAAP) as the basis of financial reporting. The International Financial
Accounting Standards (IFRS) is an alternative way to report financials. This
article from Ernst and Young compares the two methods of financial reporting.
Ernst & Young’s US GAAP vs.
IFRS: The Basics
http://www.ey.com/Publication/vwLUAssets/US_GAAP_v_IFRS:_The_Basics/$FILE/US%20GAAP%20v%20IFRS%20Dec%202011.pdf
After reading the article from
Ernst and Young, answer the following questions:
How does the GAAP reporting
method cause cash flows to differ from net income?
How are the features of the
Income Statement, Balance Sheet, and Statement of Cash Flow utilized in both
the GAAP and the IFRS reporting methods?
Does it make sense to adapt a
worldwide standard for financial reporting? Should this be mandated or
voluntary?
Calculate some of the potential
costs and benefits of switching from GAAP to IFRS.
Capital Rationing. Compare and contrast the Internal Rate of Return (IRR), the Net
Present Value (NPV) and Payback approaches to capital rationing. Which do you
think is better? Why? Provide examples and evidence from two articles from
ProQuest to support your position. Your post should be 200-250 words in length.
Guided Response: Review several
of your classmates’ postings. Respond to at least two classmates by explaining
why you either agree or disagree with their position. Provide evidence to
support your position.
Capital Budgeting. Review the following video:
http://searchcenter.intelecomonline.net/playClipDirect.aspx?id=4870EEC7664070BB9D6744FDA7325EE48937A8D6C2046957D894C3572333E0B94E4E0FADFA493E372EF9C0293DDF74D7
Critically reflect on the
importance of capital budgeting. Why is this such a heated subject in many
boardrooms? How does capital budgeting promote the financial health of an
organization? How will you use the financial techniques you have learned this
week to promote the financial health of your organization?
Management of Working Capital
Case Study: “George’s Trains”. View the following video:
http://searchcenter.intelecomonline.net/playClipDirect.aspx?id=4870EEC7664070BB9D6744FDA7325EE44F45E0E47862343D60FAA8E3325D1A83C46D5C6FAB3D01A758FA30144214BB3D
It appears that George is
running a profitable business. George is aware you are in an MBA Managerial
Finance class and comes to you for advice on his working capital practices.
More specifically George asks:
1. How you would describe my
working capital practices, including my methods of capital budgeting analysis
techniques?
2. What are potential pitfalls
in my Capital Budgeting practices that I should be aware of?
3. Develop a simple Statement
of Cash Flows for George’s Trains using any information gleaned from the video.
What areas of improvement do you recommend? Provide at least three references
from the Ashford Library or other scholarly sources to support your
recommendations.
In a three to five page paper
respond to George’s request for advice and answer each question in detail. The
Written Paper should be properly formatted in alignment with APA 6th edition
formatting.
Applying the Capital Asset
Pricing Model (CAPM). Analyze the Capital Asset
Pricing Model (CAPM). Using the course text and an article from ProQuest as
references, address the following:
Explain how the CAPM assists in
measuring both risk and return.
Explain how the CAPM assists in
calculating the weighted average costs of capital (WACC) and its components.
Illustrate why some managers
have difficulty applying the Capital Asset Pricing Model (CAPM) in financial
decision making.
Identify the benefits and
drawbacks of using the CAPM.
Develop a 200 – 300 word answer
supporting your position.
Risk Identification and
Mitigation. Using the annual report from the company
that you have selected for your Final Project, discuss the risks the company
faces and the actions they take to mitigate those risks. Refer to the
Management Discussion and Analysis section of the annual report for this
information.
As part of your response
consider whether you think the risk mitigation techniques are reasonable.
Discuss what others concerns or advice you would offer if you had the
opportunity.
Include in your post a calculation
for the probability of one of the risks identified by your company. This
information may not be available in the annual report, therefore you will
likely need to conduct research and critical thinking to complete this
calculation.
Tip: For help with reading an
annual report access this handy guide from Money Chimp (http://www.moneychimp.com/articles/financials/fundamentals.htm) .
Types of Risk. View the following Video:
http://searchcenter.intelecomonline.net/playClipDirect.aspx?id=4870EEC7664070BB9D6744FDA7325EE409273F0294E05CB605BD2644A49FA1711B997988CEF21D86EF438737AEFFE09D
This video introduces the
concept of business risk and risk management. It notes that business risks can
generally be classified into four categories: property, market, employee, and
customer.
Using each of the above four
categories of risk, develop an analysis on how financial management techniques
or policies can be used to mitigate each of these risks. To supplement your
risk analysis, research the ProQuest database and find at least one
article for each of your risk mitigation techniques or policies.
Summarize your findings in a
three to five page paper excluding title page and references page(s), and
formatted according to APA style as outlined in the Ashford Writing Center. Be
sure to properly cite your scholarly resources using APA style.
Factors in Capital Budgeting
Decisions. Imagine you are a representative of
management in the company you have selected for your Week Six assignment and
you must make a capital budgeting decision. The decision is to implement a new
computer network system to decrease the time between customer order and
delivery. The cost will be 10% of last year’s profits. You are charged with
describing the important considerations in the decision-making process to upper
management. In your response, be sure to include the following:
A description of the important
factors, in addition to quantitative factors, that were considered when making
this capital budgeting decision.
An explanation of how these
factors are significant to the company.
A summary of how you will
determine the criteria to rank capital budgeting decisions and whether some
criteria are more important than others.
A calculation of the proposed
return on investment based on criteria you select and justification for that
ROI.
Develop a 200 – 250 word
explanation supporting your recommendations.
Tip: For help with reading an
annual report access this handy guide from Money Chimp (http://www.moneychimp.com/articles/financials/fundamentals.htm)
Assessing Dividend Policy. Revisit the company you chose for your Week Six Final Project.
Using the annual report and other sources such as a 10k or 10q’s, discuss the
dividend policy of your company.
Answer the following questions
as part of your response:
How would you describe your
chosen company’s dividend policy?
Why do you believe this company
chose the dividend policy they have in place?
Do you agree or disagree that
they have selected the best dividend policy for the company?
How might this dividend policy
function in both perfect and imperfect capital markets?
Calculate the dividend rate
over the past 5 years. Define why you believe that it has or has not changed
over the last 5 years.
Support your position with
evidence from the text or external sources.
Your post should be 200-250
words in length.
Comparing Capital Expenditures. Access the annual reports for your selected company for the past
three years. Next, select a company that is a direct competitor and download
the previous three years annual reports.
Research Tip: The “Mergent”
database in the Ashford Library contains company profiles and financial
information for publicly traded companies and their competitors. To access this
database enter the Ashford Library and select “Find Articles and More” in the
top menu panel. Next, select “Databases A-Z” and go to section “M” for
“Mergent”. For help with using Mergent use Mergent Online Quick Tips.
Tip: For help with reading an
annual report access this handy guide from Money Chimp (http://www.moneychimp.com/articles/financials/fundamentals.htm)
Using the annual reports of
both companies complete the following:
For each company report the
amount of capital spending for the past three years. Quantitatively determine
whether the amount of capital spending has been consistent or if it has
fluctuated. Be sure to provide the calculations used to determine your answer.
Describe the capital expenditures of each firm and the factors that impacted
the companies’ debt capacity and capital structure.
Next, compare the level of
capital spending across the two firms. Point out how the spending was similar
and/or different and speculate why the similarities or differences might exist.
Support your analysis with evidence from the text, external sources, and articles/reports
from the Mergent database in the Ashford Library.
Summarize your findings in a
three to five page paper excluding title page and reference page(s). Format the
paper according to the APA 6th edition style guide as outlined in the Ashford
Writing Center. Be sure to properly cite your resources using APA style.
Capital Budgeting and Dividend
Policy. We examined two very important topics in finance this week;
Capital Budgeting and Dividend Policy.
Critically reflect on the
importance of selecting the right projects in which to invest capital. Do we
always select those projects that have the highest return on investment? What
other factors play into capital budgeting decisions?
We also looked at dividend
policy. What incentive is there for a company to pay dividends? What signals
does dividend policy provide to investors?
Comparing Financial Ratios. Go to MSN Money.
(http://investing.money.msn.com/investments/key-ratios) and type in a ticker
symbol for a company with the first letter of your last name.
Next, complete the following:
a. Select “Key Ratios” on the
left menu panel.
b. There are several categories
listed for ratios. Select one “Financial Condition Ratio” and one “Management
Efficiency Ratio”.
c. Open the Profile section on
the left menu panel and you will see “Industry” is identified. Find a
competitive company within that industry and compare those ratios to the ones
you just found.
Examine your findings and
determine whether your company outperforms its competition based on financial ratios.
Identify where your firm seems to lag. Describe how your firm compares with the
industry and speculate as to why you believe your firm is performing as it is.
Potential Issues in Ratio
Analysis. As your text describes, ratio analysis is a
common technique in financial analysis. One of your colleagues states that a
thorough ratio analysis is all that is needed in considering the financial
health of a company. Although you agree that ratio analysis is a helpful guide,
there may be some potential pitfalls in ratio analysis.
Discuss at least three
potential issues in utilizing ratio analysis that you would share with your
colleague. In addition, calculate a liquidity, profitability, and efficiency
ratio from your Week Six company to demonstrate your observations.
Develop a 200 – 300 word
explanation supporting your findings.
Focus of the Final Paper
Evaluation of Corporate
Performance
The Final Project will involve
applying the concepts learned in class to an analysis of a company using data
from its annual report. Using the concepts from this course, you will analyze
the strengths and weaknesses of the company and write a report either
recommending or not recommending purchase of the company stock.
The completed report should
include:
An introduction to the company,
including background information.
A complete and thorough
financial statement review.
Pro Forma financial statements
(Balance Sheet and Income Statement) for the next two fiscal years, assuming a
10% growth rate in sales and Cost of Goods Sold (COGS) for each of the next two
years.
Complete ratio analysis for the
last fiscal year using at least two ratios from each of the following
categories:
a. Liquidity
b. Financial leverage
c. Asset management
d. Profitability
e. Market value
Calculate Return on Equity
(ROE) using the DuPont system.
Assess management performance
by calculating Economic Value Added (EVA).
Review of the soundness of the
company’s financial policies (e.g. capital structure, debt, leverage, dividend
policy, etc.) based on the material covered during class.
A synopsis of your findings,
including your recommendations and rationale for whether or not to purchase
stock from this company.
This report should be 15 – 20
pages long excluding title page and reference page(s) using APA 6th edition
formatting guidelines. Support your findings and recommendations with evidence
from at least five scholarly sources in addition to the annual report; such as
the textbook, industry reports, and articles from the Ashford library. Be sure
to include links to websites that were used as references or to access company
information.
VERSION 2
BUS 650 Week 1 Assignment
Assignment: Closing Case: Ch 4
Complete Chapter 4 Closing Case at the end of the chapter and
submit answers to your instructor.
- The importance of the age factor cannot be undermined. If an
individual is still young, the cost of pursuing a degree such as an MBA
can be offset by the chances of increase in salary with time. The cost
essentially includes the cost of tuition and that of the cost of
opportunity of lost salary.
- The most crucial non-quantifiable factors would be the
marital status of the individual and the number of children to support. If
the person is married and has to support his or her spouse and children,
the drive to get back to school would be less mainly because the family
would need the person’s financial and personal support. Some of the other
factors are the passion to pursue studies, the satisfaction obtained from
the profession, and the sense of pride the job gives to the person
irrespective of the compensation.
- There are three possible options: continuing with the present
job, quitting to pursue a Wilton MBA, or opting for a Mt. Perry MBA. We
now have to calculate the after-tax value of each of the options.
Continuing with present job:
After-tax salary = $55,000(1 –
.26) = $40,700
The rate of growth of the
salary is 3 % annually, which makes the present value of the after-tax salary
to be:
PV = C
BUS 650 Week 1 DQs
DQ1 Cash Flow
Review Chapter 2 Closing Case at the end of the chapter. In at
least 200 words, fully answer questions 3. Respond to at least two of your
fellow students’ postings
DQ2 Ethics and Firm’s Goals
Review Chapter 1 Concept Questions 3, 5 and 6 at the end of the
chapter. Can goals like avoiding unethical or illegal behavior be in conflict
with the goal of the firm? How does this complicate the agency problem? Fully
explain your reasoning in at least 200 words. Respond to at least two of your
fellow students’ postings.
BUS 650 Week 2 Assignment
Assignment: Closing Case: Ch 9
Complete Chapter 9 Closing Case at the end of the chapter and
submit answers to your instructor.
In the case considered, there
are four alternatives on harvesting time; 40, 45, 50, 55 years to find out the
most profitable one. The NPV being the most accurate tool in cost analysis will
be applied for this purpose. (1)
In the case considered, there
are four alternatives on harvesting time; 40, 45, 50, 55 years to find out the
most profitable one. The NPV being the most accurate tool in cost analysis will
be applied for this purpose. (1)
40 year Harvest
|
|
Revenue
|
$39,800,250
|
|
|
Tractor cost
|
7,200,000
|
|
|
Road
|
2,700,000
|
|
|
Sale preparation & admin
|
945,000
|
|
|
Excavator piling
|
1,200,000
|
|
|
Broadcast burning
|
2,287,500
|
|
|
Site preparation
|
1,162,500
|
|
|
Planting costs
|
1,800,000
|
|
|
EBIT
|
$22,505,250
|
|
|
Taxes
|
7,876,838
|
|
|
Net income (OCF)
|
$14,628,413
|
Present Value of first harvest
PV = $14,628,413/ (1 + .0608)20
PV= $4,496,956
40 year interest rate
40-year project interest rate = [(1 + .0608)40] – 1
40-year project interest rate = 958.17%
40 year interest rate for Conservation fund
40-year conservation interest rate = [(1 + .0659)40] – 1
40-year conservation interest rate = 1,183.87%
Present Value of thinning
PV= $9,000,000/9.8517
PV= $939,286.45
Operating cash flow for 40 year
harvest: $14,482,163
PV= [($14,628,413/9.5817)] / (1 + .0608)20
PV = $469,325.52
BUS 650 Week 2 DQs
DQ1 Investment Criteria
Review Chapter 7 Concept Questions 3, 13 and 14 at the end of the
chapter. Based upon the answer to these questions, describe which three of
these investment criteria found in question 3 would you recommend for use at
your current (or a former) company for the selection of investment projects
DQ2 Capital Budgeting
Review Chapter 9 Concept Questions 1, 2 and 3 at the end of the
chapter. In at least 200 words, give at least three considerations. Support
your answer. Respond to at least two of your fellow students’ postings.
BUS 650 Week 3 Assignment
Assignment: Closing Case: Ch 12
Complete Chapter 12 Closing Case at the end of the chapter and
submit answers to your instructor.
- Book value equity 10k- $4,271,000
10Q- $ 4,230,000
Book Value Debt 10k-$22,229,000
10Q- $21,959,000
- The most recent stock price is 13.20
Market Capitalization- 25.79B
Shares Outstanding- 1.95 Bil
Dell Beta- 1.33
Yield- .15
Rs=Rf+B x (Rm-Rf)
Rs=5%+ 1.33 (6.5%)
Rs= 13.65%
- Beta of IBM, Apple, HPQ = 1.17 industry Avg.
Rs=Rf+B x (Rm-Rf)
Rs=5%+ 1.17 (6.5%)
Rs= 12.61%
The usage of Dell’s Beta
becomes pertinent as there is a difference in the cost of equity and all the
alternative companies are not the same as Dell.
- Bond portfolio
BUS 650 Week 3 DQs
DQ 1 Portfolio Allocation.
Review Chapter 10 Closing Case at the end of the chapter. In at
least 200 words, fully answer question 6 from that case. Be sure to fully and
carefully explain your choice. Respond to at least two of your fellow students’
postings.
DQ2 Controlling Risk
Review Chapter 11 Closing Case at the end of the chapter. In at
least 200 words, fully answer question 1 from that case. Be sure to fully and
carefully explain your response based upon controlling risk. Respond to at
least two of your fellow students’ postings.
BUS 650 Week 4 Assignment
Assignment: Closing Case: Ch 14
Complete Chapter 14 Closing Case: Stephenson Real Estate
Recapitalization at the end of the chapter and submit answers to your
instructor.
- Expected Value of firm:
2.
Without Expansion: (.3×2.2
million) + (.5×35 mil.)+ (.2 x 45mil.)= $33.10
million
3.
With Expansion:
(.3x26mil.)+ (.5 x 48 mil.)+ (.2 x 57 mil.)= $43.2 million
According to my estimation, the
stockholders would obviously want to be invested in a company that has
potential to expand. The stocks would then increase in value and they would get
good returns.
- The debt that the company would have with expansion under low
growth is 26 million. This without the expansion would be 22 million.
Under times of nominal and high economic expansion, the expected value
would rise up to 28 million.
- After paying back the bonds (43.2 to 15.2 million), the firm
plans to generate 15.2 million dollars at an average form the expansion
alone. The bondholders will receive the share of the debt balance and the
available income would be shared as dividends by the stockholders.
BUS 650 Week 4 DQs
DQ 1 Observed Capital Structure
In at least 200 words, fully answer Chapter 15 Concept Question 7
at the end of the chapter. Also, does this information contradict or support
the MM proposition? Be sure to include material from both chapter 14 and 15 in
presenting your answer. Respond to at least two of your fellow students’
postings
DQ2 Debt Ratio
A utility company is allowed to charge prices high enough to cover
all costs, including its cost of capital. Public service commissions are
supposed to take actions to stimulate companies to operate as efficiently as
possible in order to keep costs, hence prices, as low as possible. Some time
ago, AT&T’s debt ratio was about 33 percent. Some people (Myron J. Gordon
in particular) argued that a higher debt ratio would lower AT&T’s cost of
capital and permit it to charge lower rates for telephone service. Gordon
thought an optimal debt ratio for AT&T was about 50 percent. Do the
theories presented in Chapters 14 and 15 support or refute Gordon’s position?
Explain your answer in at least 200 words. Respond to at least two of your
fellow students’ postings companies to operate as efficiently as possible in
order to keep costs, hence prices, as low as possible. Some time ago,
AT&T’s debt ratio was about 33 percent. Some people (Myron J. Gordon in
particular) argued that a higher debt ratio would lower AT&T’s cost of
capital and permit it to charge lower rates for telephone service. Gordon thought
an optimal debt ratio for AT&T was about 50 percent. Do the theories
presented in Chapters 14 and 15 support or refute Gordon’s position? Explain
your answer in at least 200 words. Respond to at least two of your fellow
students’ postings
BUS 650 Week 5 Assignment
Assignment: Closing Case: Ch 13
Complete Chapter 13 Closing
Case at the end of the chapter and submit answers to your instructor.
- An analysis of the graph pertaining to the last 20 years
reveals a noticeable trend. The data reflects a cyclical trend. Considering
this trend and the cycle, I believe that investing in the S&P 50 index
seems to be a sound investment strategy compared to other funds.
- The efficient market hypothesis states that, “the prices of
the securities as offered to the investors are inclusive of all vital
information.” (1) There are two points which can be gathered from his
hypothesis. Primarily, in a specific period of time, the market
information and news determines the stock’s unexpected return. Secondly,
“there can be no disproportionate returns in the expectations of the
investor.” (1) To rephrase, it would be highly improbable for investors to
play in the stock market as they will have the same extent of knowledge.
BUS 650 Week 5 DQs
DQ1 Financial Ratios
Review Chapter 3 Closing Case at the end of the chapter. In at
least 200 words, fully answer question 2 from that case. Be sure to fully and
carefully explain your answer. Respond to at least two of your fellow students’
postings.
DQ2 Efficient Market Hypothesis
In at least 200 words, fully answer Chapter 13 Concept Questions
5, 7, or 9 at the end of the chapter. Support your answer. Respond to at least
two of your fellow students’ postings.
BUS 650 Week 6 Final Assignment
Final
- IRR v. MIRR Valuation Methods
- Use of Real Options Theory in Financial
Management/Modeling
- Debate the Theories of Accounting for
Stock Options
- Use of Derivatives in Risk Management
- Use of SCM as a Method of Inventory
Control
The paper must
(a) identify the main issues in the chosen area,
(b) new learning that has occurred,
(c) class activities or incidents that facilitated learning and
understanding, and
(d) specific current and/or future applications and relevance to
the workplace.
The emphasis of the paper should be on application of new
learning.
- IRR v. MIRR Valuation Methods
- Use of Real Options Theory in Financial
Management/Modeling
- Debate the Theories of Accounting for
Stock Options
- Use of Derivatives in Risk Management
- Use of SCM as a Method of Inventory
Control
The paper must (a) identify the main issues in the chosen area,
(b) new learning that has occurred, (c) class activities or incidents that
facilitated learning and understanding, and (d) specific current and/or future
applications and relevance to the workplace. The emphasis of the paper should
be on application of new learning.
For the assessment of the
profitability of a particular project, a company can resort to any of the
numerous methods in the capital budgeting. The top two preferred means of doing
these are the internal rate of return (IRR) and the Modified Internal Rate of
Return (MIRR). Depending on the end results both these approaches have their
associated merits and demerits. There is the option of using a specific method
for the comparison of different projects which have similar variable
attributes. At the same time, the alternate solutions to the projects can also
be determined. On the whole, both approaches are highly recommended in the
assessment of the most optimum solution for the determination of whether or not
a project can be taken up by the company.
The internal rate of return is
“a tool used for the calculation of the return rate in the capital budgeting to
evaluate and compare the profitability value of various investment options.”
(2) To rephrase, “the investment IRR is the rate of interest at which the cost
incurred would contribute to the benefits of the investment. This implies that
the profits from the investment are connected to the time value of money and
that the investment effectively has zero net present value at the specified
rate of interest.” (2) This approach is often considered the closest substitute
to a company’s NPV or net present value calculation. Contrary to NPV, this does
not factor in the environmental influences like the inflation rate, exchange values
etc. It is basically a numerical value that can be used to ascertain whether or
not a project can be approved. The cash flows play an important part in the
decision making in this approach. As per the financial and investment
terminologies, is the IRR is higher than the discount rate, the project can be
approved. (pg. 215, 1)
BUS 650 Week 6 DQs
DQ1 Bond Selection
Review Chapter 5 Closing Case at the end of the chapter. In at
least 200 words, fully answer questions 6 and 7 from that case. Be sure to fully
and carefully explain your answer. Respond to at least two of your fellow
students’ postings.
DQ2 International
Review Chapter 20 Closing Case at the end of the chapter. In at
least 200 words, fully answer question 5 based upon the presented material and
the answers from the four previous questions from that case. Be sure to fully
and carefully explain you answer. Respond to at least two of your fellow
students’ postings.
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