Assignment
Length: 2000 words.
1. Explain the processes and problems of making a domestic capital investment decision if you are an owner -manager with no diversified assets.
2. Discuss how your answer might change were your company to be taken over by a fully diversified owner that retains you as manager.
This is a complicated question, I can provide some help in the structure.
1. Introduction- What are capital investments? Domestic capital investment vs International capital investments (their differences, different factors)
2. Concentrated portfolios vs Diversified Portfolios
3.The process of capital investment. 4 categories of this process: 1. determination of a budget 2. search and screening of investment 3. Evaluation 4. Monitoring and control
4. Process and problems of Owner-Manager carrying out capital investment decisions. (Talk about the 4 categories and how managers handle them for example for search and screening of investment look at the concept of risk aversion, this is important as it provides the main difference for owner manager vs company taken over. For Evaluation use WACC, NPV analysis, IRR to show how it can be evaluated. For monitoring and control pull up examples and theories of how its been done before.
5. Conclusion
Format your assignment according to the following formatting requirements:
1. The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also include a cover page containing the title of the assignment, the student's name, the course title, and the date. The cover page is not included in the required page length.
3. Also Include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.