Mini case 3 1. Calculate re using the Discounted Cash Flow method (otherwise known as the Discounted Dividend Model) * The common stock price is $40 per share, and the dividend is $2. * The sustainable growth rate is .067 r equity = DIV1/P0 + g 2/40 + .067 .05 + .067 .117 or 11.7% 2. Calculate re using the Capital Asset Pricing Model CAPM cost of equity = r equity = risk free interest rate (rf) + β (rm – rf) .07 + .5(.07) = 10.5% 3- Calculate DCF cost percentage The discounted cash flow method, know as discounted dividend model, is a method to calculate the present value PV , it is an estimation of the present value PV of the cash flow associated with investment. DCF= CF/(1+r)1 where 16% is estimation of required prferred return rate DCF= .16/(1+.107) DCF = 14.45% For Question 5, we found that the book value of the WACC is lower as it is stated in p. 389 of the textbook.
Hedging Currency Risk at AIFS: Assignment questions: Q. What gives rise to the currency exposure at AIFS? A. AIFS is a company that specializes in providing educational and cultural exchange programs for college and high school students. Overall the company provides services to approximately 50,000 students each year, and has revenues of about $200,000,000. In the assigned case, we study two divisions of AIFS; a College division, a High School Travel Division, and the possible consequences to AIFS’s business exposure with respect to the fluctuations in foreign currency values and other factors.
4/28/13 acecontent.apexlearning.com/Live/online/eng_III_sem_2_la_2011/Unit_3/Lesson_2/Activity_63943/printables/Practice_Assignment777495.htm 10.2.6 Practice: Persuasive Speech Writing English III: American Literature (S1768371) Points possible: 50 Practice Assignment swag yolo Date: ____________ Write a persuasive speech that makes a claim about a topic that relates to freedom and equal rights. Use rhetorical tools and audience appeals. Avoid logical fallacies. Your speech should last between five and seven minutes when spoken and should have an introduction, reasoning, and a conclusion. Your speech should be written in 12-point font with 1-inch page margins.
1+5*BEY5yr=exp5r, where BEY5yr is the annualized Treasury Bill’s bond equivalent yield and r is the continuous compounded interest rate we want to derive, which is 5.2627%. Secondly, since historical volatility could not perfectly reflect the scenarios in the future, we use options prices that could reflect the investors’ expected volatility (due to the efficient market hypothesis). Moreover, as the volatility derived from long-term call options are more precise than that derived from short-term, we would use the 3 long
Paper and pencil and online administration available with computer, mail in scoring, and hand scoring options (Millon, Strack, Millon, & Grossman, 2006). E. Practical features: Conceptualizes behaviors into three polarities: active-passive, pleasure-pain, and self-other (Millon, Strack, Millon, & Grossman, 2006). F. General type: Aids in understanding a range of disorders that could be seen in college students. G. Date of publication: 2006 H. Cost, booklets, answer sheets, scoring: $206 per hand scoring startup kit, including 50 answer sheets with test items, answer keys, and manual. $53.50 per audio CD, $33.50 per manual and $66.50 per computer startup kit (Millon, Strack, Millon, & Grossman, 2006).
* Risk premium: Arithmetic mean is often used for one-year period valuation, while geometric mean is better for long-term period estimated expected returns. * Beta: Cohen took the average value of historical betas to measure the risk. From my perspective, however, the most recent beta is more representative than the average beta in terms of reflecting future risk. Question 2: What is your estimate of the equity cost of capital? Based on the analysis in question 1, I estimate the cost of equity as following: 9.81% =5.74% + 0.69 * (5.9%) Question 3: How, if at all, would you change Cohen’s debt cost of capital calculation?
StatNews # 73: Overlapping Confidence Intervals and Statistical Significance October 2008 In this issue of StatNews, we address the question: can we judge whether two statistics are significantly different depending on whether or not their confidence intervals overlap? The answer is: not always. If two statistics have non-overlapping confidence intervals, they are necessarily significantly different but if they have overlapping confidence intervals, it is not necessarily true that they are not significantly different. We can illustrate this with a simple example. Suppose we are interested in comparing means from two independent samples.
What information would you request? The quotes drastically differ from BL’s costs, especially for T-69 Follow up with the controller, Mike Carr. Info such as material and direct labor costs could be helpful. Is the cost savings sufficient enough to move the business to Mayes? Savings in purchasing cost: Annual demand: 800, 11.89*800 = $9512 per year.
SYLLABUS, OUTLINE, & SUPPLEMENTS Course Title: Management of Information Systems Course Number: MGM 6560 (3 Credit Hours) Six Weeks TABLE OF CONTENTS Introduction ……………………………………………………………………….…………….… 3 Course Description…………………………………………………….......……………… 3 Required Text ……………………………………………………………..…………….... 3 Course Focus ……………………………………………………………...……….……... 3 Course Goal Statement ………………………………………………………………….... 3 Course Learning Objectives ………………………………………………………….…... 3 Course Relationship to Program Learning Outcomes ……………………………….…... 3 Course Contributions to Program, School, University ……………………………….…... 3 Course Requirements ……………………………………………………..…………….... 4 Plagiarism and Cheating ………………………………………………….……………….. 4 Student Assessment ………………………………………………………………….….... 4 Suggested Supplemental Journal Reading ………………………...………....…………… 5 Important Theories, Terms, and Concepts ……………………….………...………….….. 5 Course Outline …………………………………………………………………….…………….… 7 Required Text …………………………………………………………….………….……. 7 Grading ………………………………………………………………………………….… 7 Attendance ………………………………………………………………..………………. 7 Assignment Schedule …………………………………………………….…………….…. 8 INTRODUCTION Course Description Information systems organizational and managerial principles and theories that describe the role played by various types of information systems in organizations designed to support management in the areas of finance, manufacturing, marketing databases and data communications essential for creating successful, competitive firms. Required Text Laudon, Kenneth C., Laudon, Jane P.(2012).
With our new estimate of the cost of capital, Nike’s stock has been re-evaluated in the Discounted Cash Flow valuation. Lastly, this report uses the Multiple Valuation to compare Nike with five of its competitors. Our conclusion is that Nike’s cost of capital should be 9.91% and in 2001 Nike’s price should be $51.76, compared to the current market price of $42.09. Therefore, we suggest that Nike should be a good investment. 1.