Structure (Million of USD) Market Cap 1‚134.07 ST Debt 13.78 LT Debt 352.63 Pref. E - Total 1‚500.48 Graph 2 According to the 2010 annual report‚ the weighted-average outstanding shares were 55‚070 thousand. The stock price of Oct‚ 2010 is 20.59. So‚ the market Cap of equity equals to 55.07 Million * 20.59 = 1134.07 Million. The Short-term Debt and Long term Debt come from the annual report and according to the
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The average variable cost (AVC) in the short run and long run is ‘U’ shaped. Average variable cost is the total variable cost per unit of output‚ found by dividing total variable cost by the quantity of output. Thus if a firm produces X2 units of a commodity at a total variable cost of TVx2 the AVC of producing these two units of output is given as Average variable cost decreases with additional production at relatively small quantities of output and then eventually increases with relatively
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Chapter 9 Cost of Capital 1. What is the WACC? a. Weighted Average Cost of Capital- most firms employ different types of capital‚ and because of their differences in risk‚ the difference securities have different required rates of return. Typically=debt‚ preferred stock and common equity. 2. What precautions must we take when measuring the WACC to use for capital budgeting decisions (future investment)? b. The company’s current and recent past book and market value structures
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Thuy for her enthusiastic guidance and response all of questions to help me complete this exercise easily. Simultaneously‚ thanks to her professional lectures on class which also build me with deep understanding of how to access and deal with problems in financial management so that I can complete this report. All of the data is collected through 2 website: http://finance.yahoo.com/ and http://www.finra.org/ I. ABOUT FEDEX CORPORATION: FedEx Corporation is a holding company. The Company provides
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November 13‚ 2013 A is for Average The percentage of A grades awarded in colleges throughout the United States have skyrocketed over the past 50 years. Unfortunately‚ this trend is not seen as an indication of higher quality or harder-working students. In fact‚ many studies have found that students in higher education devote considerably less time to studying and completing schoolwork than in the past. Corollaries between grade inflation and changing grading policies can be readily identified as content
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calculate Boeing’s WACC along with IRR to determine whether this is a financially worthwhile project. In order to calculate the WACC‚ Bair must consider the betas from Boeing’s commercial sector as well as the defense sector. One beta cannot be used for the whole company due to the vast difference in volatility between the two sectors. Once these two separate betas are calculated‚ they can be weighted based on the % revenue which each industry contributes to the company and then a WACC can be calculated
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2. TELETECH CORPORATION 1. How does Teletech Corporation currently use the hurdle rate? Currently Teletech uses a single hurdle rate for both their Telecommunications Services and Products and Services divisions. The hurdle rate is the cost of capital based on an estimate of the corporation’s WACC. 2. Please estimate the segment WACCs for Teletech (see the worksheet in case Exhibit 1). As you do this‚ carefully note the points of judgment in the calculation. Corporate Telecommunications
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Marginal Analysis A. Marginal Revenue: The increase in revenue generated from the sale of one additional unit of output 1. If there is a positive value associated with the marginal revenue there is an increase in the total revenue. Once the marginal revenue reaches or arrives at 0 then the total revenue is maximized. A decrease or negative in marginal revenue will cause the total revenue to go down. B. Marginal Cost: The additional‚ extra cost involved
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Profit in business is a financial gain earned when marginal revenue exceeds marginal cost to produce a particular product or provide a service. Basically profit is the amount of money left after a business has paid all cost associated with doing business for a certain period of time from the total revenue taken in during that same period of time. All for profit business want to maximize their profits. Without making a profit a business cannot stay open without additional investment by the business
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Sam O’Brien‚ C10390017‚ DT366 yr2 Report on the WACC for Fiat motors The WACC is the weighted average cost of capital. It is a calculation of the firms cost of capital taking into account the relevant weight of equity and debt as a proportion of the total. The cost of equity or KE calculated using a risk free rate example German 5yr government bond‚ the firm’s beta and the return on the market. The firm’s beta is a calculation of the firms exposure to the market‚ a beta of less than 1 indicates
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