FIN 515 Managerial Finance Week 3 First Course Project Answer

This four-credit course is for students who major in finance. By the end of this course,

1.What are conversion factors? Why were conversion factors developed? How do they impact on which bond is cheapest to deliver? Under what conditions would there be no cheapest to deliver? Explain in detail.

The focus of EEC’s investment of the purchasing of the supplier is to cut down on

Banks are not the only financial intermediary from which corporations can obtain financing. What are the other intermediaries? How much financing do they supply, relative to banks, in the United Kingdom, Germany, and Japan?

Based on the outlook by Verizon Communications, Inc. in their 2010 Annual Report, the investing that they do will increase the infrastructure in their telecommunication networks. Not only does the data show an increase in the national market, but there is an indication that investing globally will also increase the capabilities of Verizon’s telecommunications. The outcome shows that the investing potential is in Verizon’s favor.

An estimated regression coefficient is 10 with a standard error of 5. The null hypothesis is that the partial regression coefficient equals zero. What is the value of the t-statistic for testing the null hypothesis of the regression coefficient?

/MiddSuppose that in the coming year, you expect Exxon-Mobil stick to have a volatility of 42% and a beta of 0.9, and Merck 's stock to have a volatility of 24% and a beta of 1.1. The risk free interest rate is 4% and the markets expected return is 12%.

Which of the following is NOT normally regarded as being a barrier to hostile takeovers? (Points : 5)

1. The cause to the conflict in the rankings is that while the IRR ranking shows a percentage so that you can see what percentage you are making on certain amount, it does not show the size of the project.

Cisco is undoubtedly a front-runner in the very competitive world of networking equipment. To maintain its leadership position, Cisco needs to develop innovative products and technologies all the time. By 2007, its two core product categories, routers and switches are responsible for approximately 65% of the revenue generation for Cisco. Complex networking product like core router CRS-1 and branding campaign “The human network effect” helps Cisco to become one of the biggest companies in the world.

6. The total value of the firm, $5MM, is V=S+B We can use the OPM to determine the market value of the stock (expressed as a call option on the firm), and subtract this from $5MM to find B, the market value of the debt. For Rf = .05, we have S = VN(d1) – D e − rf T N(d2) where S = market value of the stock V = market value of the firm D = face value of the debt d1 = ln(5MM / 4MM) + (.05)(10) + (1/ 2 ( .5)( 10)

The purpose of the report was to discuss the business strategy of Cisco Systems Inc (Cisco), a company widely considered innovative. The report was to discuss the justification of Cisco’s status of innovative, how the business environment impacted on Cisco and it’s opportunities for innovation, their sources of competitive advantage, strategic options available to Cisco, and evaluate the risks of implementing the strategic change to achieve this option

The advantages to a LLC are: 1) Reduction of personal liability. A sole proprietor has unlimited liability, which can include the potential loss of all personal assets. 2) Taxes. Forming an LLC may mean that more expenses can be considered business expenses and be deducted from the company’s income. 3) Improved credibility. The business may have increased credibility in the business world compared to a sole proprietorship. 4) Ability to attract investment. Corporations, even LLCs, can raise capital through the sale of equity. 5) Continuous life. Sole proprietorships have a limited life,

SSFF as a company is one of the reliable importers and distributors of automotive spare parts in Pakistan. Currently we are giving our services in Pakistan only, but in future, we are looking forward to extend it to the Afghanistan and other neighboring countries.

CHAPTERS IN THIS PART 1 2 3 The Role and Environment of Managerial Finance Financial Statements and Analysis Cash Flow and Financial Planning