...Managerial Finance NCCB5060/MBQCB821 Fall 2015 – Class of 2017 Course Professor: Andrew Karolyi Detailed Assignments for Session 4 Readings are recommended by a prioritization denoted by superscripts: *** (read carefully), ** (read for effect), and finally * (skim). Each segment also indicates which end-of-chapter problems to attempt before class. These problems should be highlighted in the “Assignments” tab of MyFinanceLab© as “EMBA Americas 2017 Session 4.” If you need access to your textbook on-line, go to “Student Center” tab and click on “Access the full e-text.” Session 4.0: Finish Session 3’s Module on Valuation II: Stock Valuation Session 4.1: Risk and Return I: Capital Markets and the Pricing of Risk Read carefully Chapter 10, Sections 10.1-10.4 (pp. 313-328), 10.6-10.8 (pp. 331-342) *** Skim Chapter 10, Sections 10.5 (pp. 328-331) Work Problems: Chapter 10: 1, 2, 3, 29, 30, 35, 36, 37 Supplementary Spreadsheet: Ibbotson & Associates Historical Record of Returns Supplementary Video 7: Capital Markets and the Pricing of Risk Session 4.2: Risk and Return II: Optimal Portfolio Choice Read carefully Chapter 11, Sections 11.1-11.3 (pp. 352-363), 11.4 (pp. 363-371) *** Skim Chapter 11, Section 11.5 (pp. 371-375) * Read Chapter 11, Section 11.6-11.8 (pp.375-386) ** Work Problems: Chapter 11: 23, 24, 25 Supplementary Spreadsheet: Effect of Correlations Supplementary Video 8: Optimal Portfolio Choice Part 1 Supplementary Video 9: Optimal Portfolio Choice...
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...UNIT-I Unit I: Nature of Financial Management: Meaning – Nature – Objectives – Scope- Functions of Financial Management – Financial forecasting – Financial Planning – Time Value of Money (NP) Nature of Financial Management: Meaning: Financial Management means planning, organizing, directing and controlling the financial activities such as procurement and utilization of funds of the enterprise. It means applying general management principles to financial resources of the enterprise. Nature Scope/Elements 1. Investment decisions includes investment in fixed assets (called as capital budgeting).Investment in current assets are also a part of investment decisions called as working capital decisions. 2. Financial decisions - They relate to the raising of finance from various resources which will depend upon decision on type of source, period of financing, cost of financing and the returns thereby. 3. Dividend decision - The finance manager has to take decision with regards to the net profit distribution. Net profits are generally divided into two: a. Dividend for shareholders- Dividend and the rate of it has to be decided. b. Retained profits- Amount of retained profits has to be finalized which will depend upon expansion and diversification plans of the enterprise. Get MBA study materials, articles, order business templates and stock market updates from or http://www.easymbaguide.in/ or www.easymbaguide.jimdo.com or www.easymbaguide.blogspot.com. Give your valuable feedback...
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...Financial management Section A Part One- 1. d. Ignored routine problems 2. c. Redeemable preference shares 3. a. Political risk 4. a. Future cost 5. c. Designing optimal corporate capital structure 6. b. Firms point 7. d. Agency costs 8. a. Legal requirement 9. b. Default risk 10. a. Beta Part two- 1. A process that increases the current net value of business or shareholder capital gains, with the objective of bringing in the highest possible return. The wealth maximization strategy generally involves making sound financial investment decisions which take into consideration any risk factors that would compromise or outweigh the anticipated benefits. 2.The selling of a company's accounts receivable, at a discount, to a factor, who then assumes the credit risk of the account debtors and receives cash as the debtors settle their accounts also called accounts receivable financing. Eg:Cons Deciding whether or not to pursue a course of study through an online university is a highly personal decision, factoring in time, finances and the level of self-motivation required (which is often quite considerable, leading some online students to fall short). 3. A financial product sold by financial institutions that is designed to accept and grow funds from an individual and then, upon annuitization, pay out a stream of payments to the individual at a later point in time. Annuities are primarily used as a means of securing a steady cash flow for an individual...
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...dividends year after year. Last year, the company had announced 20 per cent dividend, which was the highest in the automobile sector. The company has never defaulted on its loan payments and enjoys a favorable face with its lenders, which include financial institutions, commercial banks and debenture holders. The competition in the car industry has increased in the past few years and the company foresees further intensification of competition with the entry of several foreign car manufactures many of them being market leaders in their respective countries. The small car segment especially, will witness entry of foreign majors in the near future, with latest technology being offered to the Indian customer. The Zip Zap Zoom’s senior management realizes the need for large scale investment in up gradation of technology and improvement of manufacturing facilities to pre-empt competition. Whereas on the one hand, the competition in the car industry has been intensifying, on the other hand, there has been a slowdown in the Indian economy, which has not only reduced the demand for cars, but has also led to adoption of price cutting strategies by various car manufactures. The industry indicators predict that the economy is gradually slipping into recession. Exhibit 1 Balance sheet as at March 31,200 x (Amount in Rs. Crore) Source of Funds Share capital 350 Reserves and surplus 250 600 Loans :...
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...price in a hostile takeover bid. You have to value Arcelor as well as analyze the implications for optimal capital structure. Solve questions 1-4 of the case. Case 2 : Arcelor Mittal Takeover This case describes the hostile bid of Mittal for Arcelor in the first half of 2006. The case illustrates the different defence mechanisms firms can employ in hostile bid situations. It documents stock price behaviour around the crucial events surrounding the acquisition. Why does the market reacts in a particular way to the various takeover defences? The case allows calculation of synergy benefits as estimated by Mittal as well as market estimates by measuring announcement returns. It also enters into a discussion of optimal acquisition finance. 1. a. What defensive measures does Arcelor take to ward off Mittal? b. Which ones do you expect to be most effective? c. How does the stock market react to these anti-takeover actions (for both Arcelor and Mittal) and why? 2. a. What are the anticipated synergies in the Arcelor Mittal Takeover ? b....
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...interest rates. The company manages interest rate risk by reference to pricing intervals spread across different periods of time with the proportion of floating and fixed rate debt managed separately. The mix of fixed and floating interest rate funding is managed by using three types of financial instrument: interest rate swaps, forward rate agreements and options. The other risks of market risk are foreign exchange and fuel price risks which are emphasised on this report. Foreign exchange risk is the risk that fair value of future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates. The factors that raise this risk are from operations, capital expenditures and translation risks. Fuel price risk management focuses primarily on when and how the entity can best hedge against costly exposures to fuel...
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...Capital required for a business can be classifies under two main categories: Fixed Capital Working Capital Fixed capital It refers to any kind of real or physical capital (fixed asset) that is not used up in the production of a product and is contrasted with circulating capital such as raw materials, operating expenses and the like. Fixed capital is that portion of the total capital that is invested in fixed assets (such as land, buildings, vehicles and equipment) that stay in the business almost permanently, or at the very least, for more than one accounting period. Fixed assets can be purchased by a business, in which case the business owns them, but also leased, hired or rented, if that is cheaper or more convenient, or if owning the fixed assets is practically impossible. FIXED CAPITAL Every business needs funds for two purposes for its establishments and to carry out day to day operations. Long term funds are required to create production facilities through purchase of fixed assets such as plant and machinery, land and building, furniture etc. Investments in these assets are representing that part of firm’s capital which is blocked on a permanent or fixed basis and is called fixed capital. Permanent or fixed working capital is the minimum amount which is required to ensure effective utilization of fixed facilities and for maintaining the circulation of current assets. There is always a minimum level of current assets which is continuously required by the...
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...What is the Veronas’ net monthly cash flow? Cash Flows Gross Income Tax After- Tax Income Melody $ 22,000 $ 4,000 $ 18,000 Charles $ 28,000 $ 5,600 $ 22, 400 $ 50,000 $ 9,600 $ 40,400 Monthly figure $ 40,400/ 12 = $ 3,366.67 Monthly cash flow Gross Income less Tax as an Expense Melody $ 1,833.33 $ 333.33 Charles $ 2,333.33 $ 466.67 $ 4166.66 - $ 800.00 = $ 3366.67 Cash out flow $ 400 + $ 200 + $ 950 + $ 200 + $ 50 + $ 150 + $ 360 + $ 160 + $ 10 + $ 150 + $ 60 + $ 100 = $ 2,790 Net Monthly cash flow $ 3,366...
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...are reading the right articles because we here can help you with your writing and finding solutions to your writing needs. Yes, that is correct. You need not worry about what to look for and how to start writing, all of this will be our problem now. Are you looking for help with your Finance Management assignment writing in particular? Our subject specific writers can help you. We have writers who have specialized in various subjects, therefore making them experts in their respective fields and areas of specialization. This shows in their quality of work delivered to you. What is Finance and Finance Management? In any business or organization, weather profit or service oriented, big or small, whatever be the nature of work, Finance is one of the most important aspects for its smooth running. No organization or business can run smoothly without having a smooth financial flow or sufficient cash in order to be able to manage its activities be it short term or long term. Finance is required for the day to day activities, planning, organizing as well as production etc. There are various branches to Finance such as: - Time value for money - Capital structure - Wealth management - Asset management - Bond and stock valuation - Venture capital and many more. Our writers have specialized knowledge in each of these areas and can provide quality assignments to you delivered at your door step at your mentioned deadline. We are just a phone call away. Call us today to find out about...
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...Xaviers Institute of Business Management Studies Subject Title: Finance Management Maximum Marks: 80 Note : Attempt any five questions. All questions carry equal marks. Q1. What do you understand by Internal Audit ? How do the functions of an internal auditor differ from that of External Auditor ? Q2. Explain the consistency concept and Accrual Concept of Accounting. How is the Accrual Concept adhered to while preparing the final accounts of a company ? Q3. What are intangible assets of a firm ? Why are they shown in the Balance Sheet ? What is meant by amortisation of such assets ? Give reason for the same. Q4. What do you understand by Appropriation of profit of a company? How are the profits appropriated ? How will the profits to be appropriated, affected, if the company issues debentures, instead of equity shares to finance its activities ? Discuss how? Q5. Distinguish between: a. FIFO and LIFO methods of Inventory valuation. b. Rights Shares and Bonus Shares c. Direct Material Price Variance and Direct Material Usage Variance d. Imputed Costs and Opportunity Costs. Q6. What do you understand by Break-even analysis ? Discuss the assumptions underlying the break-even analysis. How do these assumptions make the break-even analysis unrealistic ? Explain and prepare a Break-even chart assuming relevant figures. Q7. What do you understand...
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...Why is it important for an organization to have an eyeball view of its financial performance? Companies need to constantly monitor their performance in terms of finances. Some companies use boards to assist in monitoring the financial activities of their organization. Monitoring corporate performance is a critical function of every board. An effective board monitors the overall performance of an organization, including its operational, strategic, and financial objectives. A key aspect of the board’s oversight role is to actively monitor management’s execution of approved plans, as well as the organization’s progress toward meeting its objectives. It is essential for the board to prioritize and enumerate the organization’s objectives in monitoring its performance. Boards should establish a consistent method for receiving, reviewing, and utilizing the data received. Boards use many data points to monitor company performance, including financial and non-financial metrics, and industry and peer information, which can come from board reports, trend analyses, surveys, financial statements, industry benchmarks, and audit opinions. Knowing which metrics are most effective in understanding performance and indicating potential issues can be challenging, yet beneficial to the organization. Organization’s financial plan typically links to the annual operating plan that has been established. The annual operating plan provides details on the organization’s objectives and how they will be...
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...1. Briefly explain the significance of having finance knowledge in your everyday life. Having finance knowledge is significance because it helps us to better understanding the event that happened in our everyday life. The possessed of financial knowledge enables us to apply it through our daily life. Finance knowledge can assist us managed our money in a proper manners and thus use our money efficiently. For example, we can use our money efficiently by fully utilized surplus cash through making investment or saving in the bank. Besides, we can have better knowledge of what types of borrowing that we can take if we suffered from cash deficit. Through the understanding on the loan available and term stated make an analysis that whether you are afford to pay back the loan. If you cannot afford to back the loan you are strictly prohibited to borrow in order to prevent the worst situation to occur and probably making you to the way of bankruptcy. Moreover, having finance knowledge help us having a better understanding of the financial issues that arises in our daily life. It can lead us more concern toward the economics situation that happen around, such as the changes of the interest rates, inflation rates, currency exchange and so on. As a result, we are not easily misleading by other people to involve in a bad investment. Furthermore, through the finance knowledge that we apply in our daily life, it assist us in making a wise decision that can directly influence the wealth...
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...RISK MANAGEMENT IN ISLAMIC BANKING AND FINANCE: THE ARAB FINANCE HOUSE EXAMPLE Bilal A. Fleifel A Thesis Submitted to the University of North Carolina Wilmington in Partial Fulfillment of the Requirements for the Degree of Master of Business Administration Cameron School of Business University of North Carolina Wilmington 2009 Approved By Advisory Committee Howard Rasheed Cetin Ciner William H. Sackley Chair Accepted By DN: cn=Robert D. Roer, o=UNCW, ou=Dean of the Graduate School & Research, email=roer@uncw. edu, c=US Date: 2010.01.21 15:02:51 -05'00' ________________________ Dean, Graduate School TABLE OF CONTENTS TABLE OF CONTENTS ..................................................................................................... ii ABSTRACT........................................................................................................................ vi ACKNOWLEDGMENTS .................................................................................................. vii DEDICATION .................................................................................................................. viii LIST OF TABLES .............................................................................................................. ix LIST OF FIGURES...............................................................................................................x GLOSSARY .............................
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...Module outline Management Accounting & Applied Finance (MAAF) 12 September 2013 Chartered Accountants Program Overview Management accounting is about making better business decisions; the practical understanding of key drivers for adding value to a business; and how these are tied to the decision-making process. It’s about helping people run their businesses more efficiently and effectively in order to achieve the desired outcomes such as increasing returns or delivering improved services. MAAF includes two major integrated case studies and other practical examples and activities that will give you the skills and knowledge to identify, analyse, interpret and communicate information to help an organisation manage its resources and achieve strategic goals. The MAAF module is one of the five compulsory modules in the Chartered Accountants Program. It requires a good understanding of management accounting and applied finance from your previous tertiary studies. Units The MAAF module comprises the following units: Unit 1 2 3 4 Name of unit Introduction to management accounting (including ethics) Analysing business operations Activity-based costing and management Pricing decisions and models Online assessment 5 6 7 8 Management of revenues and costs Performance reporting Working capital management Business planning (including budgeting and forecasting) Online assessment 9 10 11 12 Performance analysis Performance measurement and management Investment decisions Short-term...
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...Definition – Explain - Example 1. Blind Experiment Blind Experiment is an experiment in which certain information that could introduce bias in the results is held back from the Subjects or Researchers or the committee monitoring the experiment or any combination of them. The term blind is used figuratively of the literal idea of blindfolding someone and hence depriving him of certain information. The main purpose of Blind Experiment is to prevent bias whether intentional or unconscious. Similarly in Blind Experiment, the participants (Subjects or Researchers or monitoring committee) are kept ignorant of information that could introduce bias in the results. Bias can cause various errors to creep into the experiment leading to incorrect results. They are of three types: 1. Single-Blind Study: Information that could introduce bias is concealed from participants (subjects) only and experimenters are not withheld from the information. However this kind of experiment faces a risk of experimenter’s bias where researchers can influence behavior of the participants consciously or subconsciously. 2. Double-Blind Study: Neither the participants nor the researchers are in possession of information that could bring in bias in the results. Both the parties are unaware of participants belonging to control group and those belonging to the test group. 3. Triple-Blind Study: This is an extension of the double-blind study , where the committee monitoring the experiment is also unaware...
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