What do you think would be the best approach if a company is entering a new industry with little historical data or no true comparable firms to derive a beta?
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What do you think would be the best approach if a company is entering a new industry with little historical data or no true comparable firms to derive a beta?
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- Why do most academics and financial executives regard the NPV as being the single best criterion and better than the IRR? Why do companies still calculate IRRs?what if your company is being targeted by a SPAC would that be a good thing or a bad thing? What factors would you look at to make that determination? what are the pitfalls in selling a company?Which of the following is an example of a way in which companies can create value by exploiting real options? A.Exercising in-the-money real options immediately B.Optimally delaying or abadoning projects C.Abandoning good projects in favor of newer projects D.Acting quickly to take on the new projects even if there is no cost to wait
- Which of the following limits the market from becoming a fully efficient market? New information takes time to process. Obtaining new information is costly. The existence of closed end investment companies. Both a. and b. are correct. All of the above answers are correct. None of the above answers is correct.PLEASE IDENTIFY AN ORGANIZATION If a firm is performing poorly financially, what might this say about the differentiators, arenas, or both? Use a specific organization as an example and apply Hambrick and Frederickson's Strategy Diamond in your response.??
- Using the data in the following table for a number of firms in the same industry, dothe following:•a. Compute the total asset turnover, the net profit margin, the equity multiplier, andthe return on equity for each firm.b. Evaluate each firm’s performance by comparing the firms with one another.Which firm or firms appear to be having problems? What corrective actionwould you suggest the poorer performing firms take? Finally, what additional data would you want to have on hand when conducting youranalyses?Firm (in million Dollars A B C D Sales $20 $10 $15 $25 Net Income after sales 3 0.5 2.25 3 Total Assets 15 7.5 15 24 Stockholders’ Equity 10 5 14 10Analysts and investors often use return on equity (ROE) to compare profitability of a company with other firms in the industry. ROE is considered a very important measure, and managers strive to make the company’s ROE numbers look good. A) If a firm takes steps that increase its expected future ROE, its stock price will increase. B) Based on your understanding of the uses and limitations of ROE, which of the following projects will a manager likely choose if his or her bonus is solely based on the ROE of the next project? Project Y, with 40% ROE and a small investment, generating low expected cash flows Project X, with 35% ROE and a large investment, generating high expected cash flows C) Suppose you are trying to decide whether to invest in a company that generates a high expected ROE, and you want to conduct further analysis on the company’s performance. If you wanted to conduct a comparative analysis for the current year, you would: Compare the…You observed that high-level managers make superior returns on investments in their company’s stock. Would this be a violation of weak-form market efficiency? Would it be a violation of strong-form market efficiency?
- 1) What is the company's WACC? 2) Should the company take the projects? Assume that the projects have the same risk as an average project for your firm. 3) If one project is depended on the other in a way that the company can only take both projects, should it take it?What would be a starting Accounting Firm's value proposition? If a starter Accounting Firm were to make an investment to open, how will they ensure customers buy the service they are selling? What would be the newly opened Accounting Firm's competitive edge?Suppose profits earned by one firm are independent of profits earned by other firms. When managers and shareholders diversify, then O poor outcomes of some projects are worsened by favorable outcomes of other projects. O both managers and shareholders are considered risk loving. O both managers and shareholders are considered risk averse. O poor outcomes of some projects can be offset by favorable outcomes of other projects.
