tailieunhanh - Ebook Foundations of finance - The logic and practice of financial management (8th edition): Part 2

(BQ) Part 2 book "Foundations of finance - The logic and practice of financial management" has contents: The cost of capital, capital structure and dividend policy, investment in long term assets, working capital management and international business finance. | 9 The Cost of Capital Learning Objectives 1 Understand the concepts underlying the firm’s cost of capital The Cost of Capital: Key Definitions and Concepts 2 Evaluate the costs of the individual sources of capital Determining the Costs of the Individual Sources of Capital 3 Calculate a firm’s weighted average cost of capital The Weighted Average Cost of Capital 4 Estimate divisional costs of capital Calculating Divisional Costs of Capital In the third quarter of 2011 ExxonMobil (XON) earned a record $ billion, which was almost double what it earned in the same quarter of 2008! But is ExxonMobil creating value for its shareholders? The key to answering this question rests not just on the level of the firm’s earnings but also on (i) how large an investment has been made in the company in order to produce these earnings and (ii) how risky the firm’s investors perceive the company’s investments to be. In other words, we need to know two things: What rate of return did the company earn on its invested capital, and what is the market’s required rate of return on that invested capital (the company’s cost of capital)? The firm’s cost of capital provides an estimate of the rate of return the firm’s combined investors expect from the company. Estimating a firm’s cost of capital is very intuitive in theory but can be somewhat tedious in practice. In theory, what is required is the following: (i) identify all of the firm’s sources of capital and their relative importance (that is, what fraction of the firm’s invested capital comes from each source); (ii) estimate the market’s required rate of return for each source of capital the firm has used; (iii) calculate an average of the required rates of return for each source of capital where the required rate of return for each source has been weighted by its contribution to the total capital invested in the firm. The cost of capital is not only important when evaluating the company’s overall .

• Tài chính doanh nghiệp
• Foundations of finance
• Financial management
• The cost of capital
• Capital structure
• Dividend policy
• Investment in long term assets
• Working capital management
• International business finance
• Straight lines
• Statistical foundations
• Econometrics for Finance
• Introductory Econometrics for Finance
• Financial data
• Financial modelling
• The financial markets
• A firm’s financial performance
• Interest rates
• Financial assets
• The valuation
• Internal financing
• Short term financial planning
• Determining the financing mix
• The time value
• Risk and return
• Financial performance
• Understanding financial statements
• The time value of money
• Capital Budgeting techniques
• Capital budgeting
• Bài giảng Tài chính
• Lecture Money banking & finance
• Demand for Money
• Keynes’ Demand for Money
• Risk return analysis
• Optimal money holding
• Disequilibrium Money
• Lecture Money Banking and Finance
• Bài giảng Tiền tệ ngân hàng
• All or Nothing Theory
• The Liquidity Trap
• The Demand for Money
• The Miller Orr model
• Regression model
• Purpose of econometrics
• Elemental View
• Financial Markets
• Transportation Agents
• Transportation Desirable
• Assets and Markets
• Quantitative Finance
• Foundations of microeconomics
• International aspects
• Model Presented
• Previous Models
• Mathematical Foundations
• Risk Model
• Journal of Finance
• Financial institutions
• Monetary policy
• International finance
• Monetary theory
• Classical foundations