Explain influences of financial leverage (debt)
Does financial leverage (i.e. debt) have any influence on the Free Cash Flow, upon the Cash Flow to Shareholders, upon the growth of the company and upon the value of the shares?
Expert
Debt has no impact upon Free Cash Flow since this is, by definition, the flow to shares when the company had no debt. Though, the equity flow does depend upon the debt. It also affects the capitalization and the value of shares. If a company raises its debt, its capitalization reduces and, naturally and the price per share increase.
You have decided to invest 30 percent in X; 30 percent in Y; and 40 percent in Z. Theprobability of the state of the economy is Boom 25%; Normal 60%; and, Bust 15%. The rateof return for stock X is Boom .20; Normal .15; and, Bust .00. The rate of return for stock Y is
Please assist with the attached Data Case assignment
Is this possible to value companies by computing the present value of the Economic Value Added (EVA)?
Suppose that the two securities APPL and MSFT account for the entire large cap technology component of the S&P 500 (hypothetically – of course – there are really plenty of others). Further, suppose that their weights in the S&P index were as follow
what can we expanded opportinity set of international finance?
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An investment bank computed my WACC. The report is as: “the definition of the WACC is defined as WACC = RF + βu (RM – RF); here RF being the risk-free rate and βu the unleveraged beta and RM the market risk rate.” It is differ from what we
Capital goods: Goods employed in producing other goods are termed as capital goods.
Kevin is interested in buying a 5-year bond which pays a coupon of 10 % on a semi-annual basis. The present market rate for similar bonds is 8.8 %. What must be the present price of this bond? (Round to the closest dollar.) (a) $1,048 (b) $965 (c) $1,099&n
Explain the branching structure of the binomial model.
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