...MLB’s Return on Investment University of Phoenix RES341: Research and Evaluation I May 10, 2010 MLB’s Return of Investment In 1842, organized baseball, now known as Major League Baseball (MLB), was created (Haupert, 2007). Since then, the industry has grown tremendously as a business enterprise and as many Americans’ favorite pastime. With its popularity, several controversial issues have arisen over the last few decades in regards to players’ salaries and imbalance of competition. From 1975 to 2002, the average MLB players’ salaries increased 5200% (Haupert, 2007) and competition concerns have been addressed by developing the luxury tax and revenue sharing throughout the industry (DeMause, 2006). To investigate these issues further, Team D is studying the relationship between MLB players’ salary, team wins, attendance and market. At the end of the research process, Team D anticipates reaching a valid conclusion to determine whether higher salaries (investment) are justified by increased attendance (return), and if there is a large inequality between large and small markets. Research Objectives The objective of this study is to determine the return of investment (attendance) on the salary structures present in MLB teams and if there is a disparity between “large” and “small” market teams in providing a successful product. The investigation will focus on the relationship between salaries, wins, attendance, and market sizes of MLB teams. Throughout...
Words: 2564 - Pages: 11
...Return on investment Return on investment (ROI) is calculation used to measure and evaluate the effectiveness of an investment. ROI can also be used to determine the value and effectiveness of current and future investments. In most cases, the ROI has a direct correlation with the investment situation given and has the potential to contain a lot of ambiguity. When Guillermo finantual analysis evaluated the ROI, they placed a great deal of focus on evaluating the current investments by making a comparison among the size of the investment and the time period of the expected revenue. In each case there is a negative return from investment. It is recommended that Guillermo should continue with the current business. The reason for this is that additional investment in buildings and equipment is re he pro forma cash flow budget has been created for the current business. The company and potential stockholders have an interest in increased and maximized profitability and a right to growth and decisions that will benefit the company. The stockholders are mainly concerned with their return on investment in the company. Intersect has values it needs to keep in mind when making decisions. The company has the responsibility of respecting its employees and upholding the integrity of the business name. The return on investment for the month of June for Guillermo is very disheartening. A -1.4% return on investment will not attract additional investors or look promising to creditors...
Words: 266 - Pages: 2
...Overview This case, as the Happy Chips Case does, illustrates the point that it is important to know where your costs and profits come from. It extends the point of Happy Chips by also introducing consideration of asset investments and return on assets. In this case, a new cost accountant introduces segmental profitability, contribution margin, and the strategic profit model to Cooper Processing Company to aid in analysis of two different distribution channels. Note to Instructors: Because this case is short and the required math is quite simple, we often use this case as part of an exam or an in-class quiz! Solutions to Questions The accompanying PowerPoint slides contain the answers to the first two questions. 1. How profitable is each channel? Slide 1 can be used for comparison of a “net profit” approach to segmental profitability with slide 2 which shows a contribution approach. Slide 1 is actually more simplistic than any real cost accountant would advocate. The Gross Margin for each channel is computed using the overall company Gross Margin percentage of 40%; even though the case clearly states that the Gross Margin percentages are different in each channel. The expenses are not broken down by category of expense and the total expense of $55 million is simply allocated on the basis of revenue. Slide 2 provides an activity based, contribution format for profitability analysis. The allocations for Selling, Promotion, Order Processing...
Words: 678 - Pages: 3
...(ROI) is an accounting term that indicates the percentage of invested money returned to an investor after the deduction of associated costs. For the non-accountant, this may sound confusing, but the formula may be simply stated as follows: |[pic] | TUTORIAL: Investing 101: Types Of Investments But while the above equation seems easy enough to calculate, a number of variables including repair and maintenance expenses and methods of figuring leverage – the amount of money with interest borrowed to make the initial investment - come into play, which can affect ROI numbers. The article below explains the two methods by which ROI calculations are made: The Cost Method and the Out of Pocket Method The Cost Method The cost method calculates ROI by dividing the equity by all costs. As an example, assume a real estate property was bought for $100,000. After repairs and rehab of the property, which costs investors an additional $50,000, the property is then valued at $200,000, making the investors' equity position in the property 200,000 - (100,000 + 50,000) = $50,000. The cost method requires the dividing of the equity position by all the costs related to the purchase, repairs and rehab of the property. Try Currency Trading Risk-Free at FOREX.com [pic] ROI, in this instance, is .33 % - $50,000 divided by $150,000. The Out of Pocket Method The out of pocket method is preferred...
Words: 876 - Pages: 4
...A study into the use of sponsorship as a marketing tool for sports organisations and its importance in the marketing communication mix Ralph Cartwright 10338648 Abstract Over the last few decades, the viewing of sport has continued to gather attention and be targeted and integrated by marketers as a part of the communication mix for organisations and brands. Therefore, the aim of this research project is to analyse the effectiveness of sport Sponsorship for Companies as a marketing tool. Supported by examples the researcher will explore an array of factors concerning the issues facing companies that invest large amounts of money into sports events, teams and athletes hoping for a return on investment each year. This project will also inform the reader of the strategies of selection sponsors go through when identifying which team, athlete or event to choose based on their objectives and type of industry. From this information, the project will then identify the positives and negatives of sport sponsorship, as it is obvious that not all organisations will benefit from this type of communication tool. Various examples and case studies concerning sponsorship and organisations will be identified and examined throughout. Contents Page Chapter 1 – Introduction of Study 5 1.1 Background 5 1.2 Study Purpose 6 1.3 Study Objective 7 1.4 Study Structure 7 1.5 Rationale of the research 8 Chapter 2 - Literature Review 9 2.1...
Words: 12736 - Pages: 51
...WRwvmsklvsMVKML’V SdDDDDDDDDDDSSSSSSSSSSSSSSS DSVsv bDDF| Question : | (TCO 1) The Accounting Equation is used to develop the organization's financial reports. (1) Describe what assets value would be if Liabilities are $12,000 and Owners' Equity is $50,000 by showing the Accounting Equation (10 points), and (2) provide an example of two asset accounts that could contain the value. (10 points) | | | Student Answer: | | 1.Assets=Liabilities+Owners Equity 12,000+50000 Assets=62,000 2.Cash and Equipment | | Instructor Explanation: | Textbook pages 11-12. Assets = $12,000 + $50,000 = $62,000. Cash and inventory are examples. | | | | Comments: | | | | Question 2. | Question : | (TCO 1) The financial statements present a company to the public in financial terms. (1) Which financial statement should be prepared first and why (10 points), and (2) explain what information this financial statement provides. (10 points) | | | Student Answer: | | the four basic financial statements are the income statement, statement of owner's equity, statement of cash flows which reports activity for a specific period of time usually a month, quarter or year and the balance sheet which reports balances of certain elements at a specific time. the income statement should be prepared first, it lists revenues and expenses and calculates the company's net income or net losss for a period of time. it lists all the expenses and losses on the debit side and all the income...
Words: 295 - Pages: 2
...A COMPARATIVE ANALYSIS OF VARIOUS INVESTMENT AVENUES WITH RESPECT TO RISK & RETURN A Project Report Submitted in partial fulfillment of the requirements for the Award of Degree of E-MBA Submitted by : Prabhjeet Singh [pic] BHARATI VIDYAPEETH DEEMED UNIVERSITY, PUNE (INDIA) School of Distance Education (SDE) Academic Study Center : BVIMR, New Delhi (University established under 3 of the UGC act,1956) CONTENTS |S.No | |P.No. | | |Acknowledgement |2 | | |Certificate |3 | |1. |Introduction | | | |1.1 : Introduction |6-7 | | |1.2 Company Profile | | | |1.3 Industry Analysis |8-14 | | |1.4 Problem in the Organisation | | | |1...
Words: 17636 - Pages: 71
...theory and proper management of the human capital will lead to greater productivity and efficiency. ‘The educating of the workers is an investment which is equally worthwhile as that of capital.’(Woodhall, 1997) Beeker (1993) asserts that ‘education and healthcare are a key to improving human capital and thence increasing the economic outputs of a nation’. These factors are the ones stressed by the human capital theory and this shows that the human capital theory recognises the need to invest in human capital inorder to generate worthwhile returns. The human capital theory brings out the value that the workers have to an organisation and to increasing shareholder value to the company and thus authorities summaries the human capital theory as ``workers having a set of skills developed by educating and training that generates stock of productive capital``(Armstrong, 2009:238). The human capital theory helps improve and increase skill to the valued workers or human capital that the company has therefore showing the cognisance that the theory takes on investing in human capital as they generate worthwhile returns. The human capital theory encourages the creation of innovative ideas and products to gain advantage over other players in the market by educating and enhancing the skills base that the workers have or possess as it will yield worthwhile returns. Armstrong (2009:68) says `` Strategic management is therefore visionary management, concerned with creating and conceptualizing...
Words: 1130 - Pages: 5
...3. Investment Climate POLITICAL AND ECONOMIC STABILITY The Czech Republic is a fully-fledged parliamentary democracy, and is one of the faster growing economies as well as one of the ten countries that entered the European Union on 1 May 2004. The country’s economic policy is consistent and predictable. A strong and independent central bank (the Czech National Bank) has maintained an extraordinary degree of currency stability since 1991. The Czech Republic was the first CEE country to be admitted into the OECD. The country is a member of NATO and is fully integrated into other international organisations such as the WTO, IMF and EBRD. EU legislation was adopted in preparation for EU accession. Czech commercial, accounting and bankruptcy laws are compatible with Western standards. The Czech koruna is fully convertible. All international transfers (e.g. profits and royalties) related to an investment can be carried out freely and without delay. NON-DISCRIMINATION Under Czech law foreign and domestic entities are treated identically in all areas, from protection of property rights to investment incentives. The government does not screen any foreign investment projects with the exception of those in the defence and banking sectors. As an OECD member the Czech Republic is committed not to discriminate against foreign investors in privatisation sales, with the same exception as that mentioned above. INVESTMENT PROTECTION The Czech Republic is a member of the Multilateral Investment...
Words: 830 - Pages: 4
...As the CEO of a company that has to choose between making a $100 million investment in either Russia or Czech Republic the risk considerations have become critically important in choosing the best option. The risk considerations include evaluation of each nation’s political, economic and legal systems along with the cultural practices, education and skill levels and each countries stage of economic development. The political systems of a country shapes both the economic and legal systems (Hill, 45). These systems are interconnected and play a vital role in making a decision of which country to make an investment in. In evaluating the risks of making the investment in Russia, the most widely discussed risk that is found is the corruption in the country; this remains a major barrier success for businesses in the nation. There is a complex business environment in Russia along with known issues involving bribery. The corruption in the nation leads to a number of problems including non-transparent and inconsistent application of laws and regulations with the weak enforcement of laws and court decisions (Business Anti-Corruption Portal). This isn’t the only area where corruption is a problem in Russia, there is corruption in the area of licensing and permits with multiple inspections and red tape. Intentional and lengthy delays in the procedures for starting a business, getting required permits and licensing are additional risks along with the corruption. It does seem as though the...
Words: 1312 - Pages: 6
...Your task: Select one presentation topic. Research the topic using the GBC library catalogue, and locate four secondary sources (preferably articles) on this topic. Your presentation must have five secondary sources (please note: I am providing you a link to one secondary source below which may count towards your sources). Using secondary research, primary research (preferably a survey), and brainstorming your own ideas on this topic, you should create a comprehensive argument which you will showcase in a Power Point presentation. You may explore the issue from multiple perspectives, but must present a strong, defensible thesis. Topics: 1) Is the college degree worth the money you pay for it and/or does it guarantee you a return in investment? Should we view education as a humanistic experience or yet another consumer product? 2) Does communication technology impact workers’ productivity? Given the access to instant messenger, Facebook, and other social media, how do workers actually work? Explore this topic from a business perspective (you may choose to focus on the employer/ employee dynamic and reaching productivity goals). 3) Some companies sell “preferred access” to their services/products. Examples of this practice are priority lines introduced by select airlines or amusement parks. How do these business practices affect sales, the consumer, and business ethics? 4) Do the current immigration policy and its point grid system benefit Canada and immigrants...
Words: 326 - Pages: 2
...Risk & Return Analysis: Analyzing an equally weighted portfolio of investments in Amazon, Inc., Yahoo! Inc., and Direct TV stock compared to the S&P 500 Introduction: Every day, millions of investors spend countless hours following the stock market in the hopes of striking it rich. Making the right moves at the right moments is crucial when one looks to make large returns in the market. While luck affords many investors the opportunity to make lucrative returns in the stock market, this reward does not come without risk. In order to balance their returns and the amount of risk that they are exposed to, many investors create an investment portfolio as a means to mitigate risks in the market at the expense of foregoing potentially higher returns on their investment. To illustrate the effects that a diversified portfolio can have on the amount of risk an investor takes on as well as the returns that the investment generates, a sampling of three random stocks and the S&P 500 index was created to examine the effects that diversification has on investment risk. Investments: For this analysis, monthly stock data from December 1, 2009 – December 1, 2014 was compiled on three stocks and the S&P 500. The three investments chosen for the portfolio were Amazon.com Inc. (AMZN), Yahoo! Inc. (YHOO), and DirectTV. (DTV), and each represent 25% of the portfolio. In order to analyze the risks associated with each stock, a Risk-Free rate of interest must be established in order...
Words: 1815 - Pages: 8
...Value vs Internal Rate of Return (Relevant to AAT Examination Paper 4 – Business Economics and Financial Mathematics) Y O Lam Capital budgeting assists decision makers in a company evaluate multiple investments of the company’s capital. Capital budgeting is used to plan for the acquisitions of other companies, for the development of new product lines of business, for the expansion of the existing production plants or for the replacement worn-out equipment, and in planning decisions on whether or not to enter a new market line, whether to buy or rent production facilities, and any other investment project resulting in costs and revenues that are spread over a number of years. Capital budgeting is the method used to assess a major investment or to see whether one option is better than another. There are several capital budgeting methods, each with advantages and disadvantages. In this article, we discuss the basic principle and the advantages and disadvantages of using the net present value technique and the internal rate of return technique. Net present value (NPV) method When using the net present value method of capital budgeting, one of most important factors is the estimation of net cash flows from an investment. The net cash flow is the difference between cash outflows and cash inflows over the life of the investment. First, cash flows should be calculated on an incremental basis, and include changes in operating cash flows and changes in investment cash flows. Second, cash...
Words: 1397 - Pages: 6
...The return from holding an investment over some period of time is simply any cash payments received due to ownership, plus the change in market price usually expressed as a percent of the beginning market price of the investment. Return comes to you mainly from two sources – income or dividend plus any price appreciation (capital gain or loss) Dt + ( Pt – Pt-1) R = Pt-1 Suppose, you buy for Tk. 100 a security that would pay Tk. 7 in cash to you and be worth Tk. 106 one year later. This return would be (7 +6)/ 100 = 13%. Risk can be defined as the variability of return from those that are expected. In financial decisions it is often helpful to have an objective measure of risk. The main reason for having measuring of risk is to enable us to make better decisions. To be useful, a risk measure should enable us to rank alternative risky ventures. If there are two possibilities being analyzed, A and B, it is often important to know whether A is riskier than B or not. A good measure of risk should also tell us how much more risky A is than B. Is A twice as risky or ten times as risky as B? Is risky at all? Risk measurement procedures are usually based on a particular method of organizing financial problem -through probability distribution. (A set of possible values that a random variable can assume and their associated probabilities of occurrence.) Suppose you are thinking about purchasing stock A, which has a current...
Words: 4352 - Pages: 18
...technique that is used to make various intermediate range decisions. In the Guillermo Furniture example, capital budgeting will help Guillermo to determine whether to purchase or lease the new hi-tech manufacturing equipment or whether Guillermo should increase his sales through changing his business model into a brokerage. There are several capital budgeting techniques that Guillermo can use to determine how best to proceed with his decisions. These concepts include the net present value, internal rate of return, the simple and discounted payback method, the unadjusted rate of return and the annual rate of return method (it is important to note that there are various other capital budgeting techniques). It is important to remember that each of these techniques has their own advantages as well as disadvantages. Also, more than one technique can be applied to a particular proposal to take advantage of more information. To help Guillermo determine the profitability of the investment, he could use the net present value method. The net present value is the difference between the present value of cash inflows and the...
Words: 1220 - Pages: 5
