Fundamentals of Corporate Finance Phần 8 doc

... Pretax profit (1 – 2 – 3 – 4) 550,000 –2,0006. Taxes (40%) 220,000 80 07. Profit after tax 330,000 –1,200 8. Cash flow from operations (4 + 7) 780 ,000 4 48, 800Present value of cash flows 5 ,87 8,000 ... profits will increase by .01 × (sales – variable costs) = .01 × (profits + fixedcosts). Now recall the definition of DOL:DOL =percentage change in profits=change in profits/level of profitspercentage ... profitspercentage change in sales .01= 100 ×change in profits= 100 ×.01 × (profits + fixed costs)level of profits level of profits=1 +fixed costsprofitst helps to use discounted cash-flow techniques...

... days3,5 18/ 365This is a reduction of 22 .8 days from the original value of 48. 7 days.Days in receivables =300= 27.6 days3,9 68/ 365This is a reduction of 16.2 days from the original value of 43 .8 ... payables 0 10 .8 0 07. Securities sold 5 0 0 0 8. Total cash raised 45 15 .8 0 0Repayments9. Of stretched payables 0 0 10 .8 010. Of bank loan 0 0 13 .8 31.2Increase in cash balances11. Addition ... over the 28 months, assuming an interest rate of 8 percent?c. What was the present value of the increase in float if the benefits were expected to be per-manent?d. Suppose that the use of remote...

... standard deviation of monthly returns, percent’26 ’30 ’340.0010.0020.0030.0040.0050.0060.0070.00’ 38 ’42 ’46 ’50 ’54 ’ 58 Year’62 ’66 ’70 ’74 ’ 78 82 86 ’90 ’94 ’ 98 DIVERSIFICATIONStrategy ... the sum of the income from the bond, $80 , plusthe capital gain, $30, or $110. The rate of return isIncome plus capital gain= 80 + 30= .1 08, or 10 .8% Original price 1,020Real rate of return ... cost of capital.2. The rate of return rule. Invest in any project offering a rate of return that is higherthan the opportunity cost of capital.1Recall that we are assuming the profit on the office...

... (January–February 1 986 ), pp.91–1 18; W. H. Mikkelson and M. M. Partch, “Valuation Effects of Security Offerings and the IssuanceProcess,” Journal of Financial Economics 15 (January–February 1 986 ), pp. ... Investors Do Not Have,” Journal of Financial Economics 13(1 984 ), pp. 187 –222.PRIVATE PLACEMENTSale of securities to a limitednumber of investors withouta public offering.Leasing 551ized.” ... operates a chain of 140 fast-food outlets in the UnitedStates offering unusual combinations of dishes.The Offering: Common Stock offered by the Company 500,000 shares;Common Stock offered by the...

... Financing 185 Bank Loans 185 Commercial Paper 186 Secured Loans 186 The Cost of Bank Loans 187 Simple Interest 187 Discount Interest 188 Interest with Compensating Balances 189 Summary 190Related ... Budgeting 481 Decision Trees 481 The Option to Expand 482 Abandonment Options 483 Flexible Production Facilities 484 Investment Timing Options 484 Summary 485 Related Web Links 485 Key Terms 485 Selected ... 577Mergers Financed by Cash 577Mergers Financed by Stock 579A Warning 580 Another Warning 580 22.5 Merger Tactics 582 Who Gets the Gains? 584 22.6 Leveraged Buyouts 585 Barbarians at the Gate? 587 22.7...

... 2.1003 3.153 3. 184 3.215 3.246 3.2 78 3.3104 4.310 4.375 4.440 4.506 4.573 4.6415 5.526 5.637 5.751 5 .86 7 5. 985 6.10510 12.5 78 13. 181 13 .81 6 14. 487 15.193 15.93720 33.066 36. 786 40.995 45.762 ... 1.061364 6.1364Monthly 12 .5 1.00512= 1.0616 78 6.16 78 Weekly 52 .115 38 1.00115 38 52= 1.06 180 0 6. 180 0Daily 365 .01644 1.0001644365= 1.06 183 1 6. 183 1 ... limited number of years is called an annuity. The present value of astream of cash flows is simply the sum of the present value of each individual cash flow.Similarly, the future value of an annuity...

... millions of dollars)End of Year Start of YearAssetsCash and marketable securities 89 1 58 Receivables 2, 382 2,490Inventories 187 2 38 Other current assets 86 7 932Total current assets 3,525 3 ,81 8Net ... 1525,750–62,450 43,050–104,050 28 62,450–130,250 104,050–1 58, 550 31130,250– 283 ,150 1 58, 550– 283 ,150 36Over 283 ,150 Over 283 ,150 39.6MARGINAL TAX RATEAdditional taxes owed perdollar of additional income.AVERAGE ... DataYear Ending, First End of First Quarter End of First QuarterQuarter 1999 19 98 1999Sales $3,9 68 Inventory $470 $4 68 Cost of goods sold 3,5 18 Accounts receivable 471 481 Accounts payable 304...

... 4520 98 352 681 5 488 11097394297359 98 45 68 7630501637 58 1464250219999 286 63203256649 68 129121/2369/162615/16291/4515/16 18 7/1651/1639/16343 /8 697 /8 413/162771 /8 141/16321/16163/411/16471 /8 335/1645/16 48 7 /8 519/16203/16127/16341/16261/2 28 1 /8 51/21743/435/16333/16641/241/2253/465 /8 137 /8 313/4161/45 /8 451/2329/1641/16473/16 48 5/161915/16151 /8 497/16295 /8 3915/16215 /8 251/4111/1661/16411/2 84 1/261 /8 437/16131/2173 /8 367 /8 243 /8 23/16511/45011/256 8 11/16663 /8 73259/16nsnࡔࡔ111/4297 /8 125 /8 28 1/251/2151/241/233/16301 /8 251/233/4155/16415/16103 /8 28 1/4111/1613/32233035 /8 423/44511/16193/4Hi52 ... 4520 98 352 681 5 488 11097394297359 98 45 68 7630501637 58 1464250219999 286 63203256649 68 129121/2369/162615/16291/4515/16 18 7/1651/1639/16343 /8 697 /8 413/162771 /8 141/16321/16163/411/16471 /8 335/1645/16 48 7 /8 519/16203/16127/16341/16261/2 28 1 /8 51/21743/435/16333/16641/241/2253/465 /8 137 /8 313/4161/45 /8 451/2329/1641/16473/16 48 5/161915/16151 /8 497/16295 /8 3915/16215 /8 251/4111/1661/16411/2 84 1/261 /8 437/16131/2173 /8 367 /8 243 /8 23/16511/45011/256 8 11/16663 /8 73259/16nsnࡔࡔ111/4297 /8 125 /8 28 1/251/2151/241/233/16301 /8 251/233/4155/16415/16103 /8 28 1/4111/1613/32233035 /8 423/44511/16193/4Hi52 ... CloseVol100sNetChg121/2345 /8 269/16 28 3 /8 57 /8 171 /8 415/1631/234653/1641/2261/47141/16313/4169/1611/1647331/1641/4 48 1/2 48 13/16201 /8 1/1621 /8 1/165 /8 1/417/161 /8 1 /8 3/1631/2...

... Then the beta of your portfo-lio will be a mixture of the beta of the market (βmarket= 1.0) and the beta of the T-bills(βT-bills= 0):Beta of portfolio =(proportion×beta of )+(proportion×beta ... 4,445 1,556 1,2403 1, 481 5 18 3694 741 259 165Totals 10,000 3,500 2 ,81 6The present value increases to 2 ,81 6, or $2 ,81 6,000.arlier we began to come to grips with the topic of risk. We made the ... +1 + 1 .8 }Average = .8% 3+1 –.24 –1 – 1 .8 5–1 +.2}Average = – .8% 6–1 – .8 Look at Figure 4.7, where these observations are plotted. We’ve drawn a line throughthe average performance of Turbot...

... 5.3 68 5.446 5.524 5.604 5. 684 5.766 5 .84 8 5.931 6.016 6.101 6. 187 5 6 .87 7 7.014 7.154 7.297 7.442 7. 589 7.740 7 .89 3 8. 0 48 8.207 8. 3 68 8.533 8. 700 8. 870 9.0436 8. 977 9.207 9.442 9. 683 9.930 10. 183 ... 217.712 244.033 273.556 306.6 58 343.7 58 385 .323 431 .87 0 483 .97320 115. 380 130.033 146.6 28 165.4 18 186 . 688 210.7 58 237. 989 2 68. 785 303.601 342.945 387 . 389 437.573 494.213 5 58. 112 630.16525 249.214 ... 211.723 233.791 2 58. 145 285 .014 18 84.141 93.406 103.740 115.266 1 28. 117 142.441 1 58. 405 176. 188 195.994 2 18. 045 242. 585 269 .88 8 300.252 334.007 371.5 18 19 98. 603 110. 285 123.414 1 38. 166 154.740...