01 Jan CAPELLA UNIVERSITY

CAPELLA UNIVERSITY BUS4070 UNIT 1 DQ 1 & DQ 2

DQ 1

You are a new financial manager in a large department store company that has stable sales and well established product line (for example, Macy’s), but does not see much growth in future sales. The company’s target markets are primarily in the USA. You were offered a detailed plan to manufacture more of your products overseas at lower costs and to try to develop a global distribution network. What possible financial and social factors would you be most concerned with?

DQ 2

Explain the difference between money and capital markets, and identify one of the most important instruments for both a money market and a capital market. Discuss the instruments you chose to include. Why do you think the instruments you chose are the most important? Be sure to include key characteristics and the role they play.

CAPELLA UNIVERSITY BUS4070 UNIT 2 DQ 1

DQ 1

Explain why financial managers must be concerned with taxation, and list some of the most important elements of the current tax laws, such as the differences between the treatment of dividends and interest paid and interest and dividend income received.

CAPELLA UNIVERSITY BUS4070 UNIT 3 DQ 1

Consider the company you work for (or if your company is not publicly held, pick a company you are familiar with). Would you consider your company to be relatively risky? Does the stock rise and fall faster than the market? What things contribute to the riskiness or stability of the stock? Define investment risk in your discussion, and consider how it affects share price. What is the CAPM and security market line, and how can they be used in assessing share price?

CAPELLA UNIVERSITY BUS4070 UNIT 4 DQ 1 & DQ 2

DQ 1

Thetime valueof money is defined as the math of finance for which interest is earned over time by saving or investing money. With this definition in mind and considering your readings for this unit, discuss why time value affects almost any financial decision. Under what situations might time value matter less?

DQ 2

Can you determine whether an investment is warranted based solely upon the NPV? If three mutually exclusive investments all show about the same NPV, how might you determine which to pursue?

CAPELLA UNIVERSITY BUS4070 UNIT 5 DQ 1 & DQ 2

DQ 1

Explain the importance of bond ratings, and list some of the criteria used to rate bonds. Differentiate between interest rate risk, reinvestment rate risk, and default risk.

DQ 2

Explain what is meant by the statement that a preferred stock is a hybrid between a common stock and a bond. What factors determine the value of a share of preferred stock?

CAPELLA UNIVERSITY BUS4070 UNIT 6 DQ 1 & DQ 2

DQ 1

Assume you are working as an investment financial officer for your company (or use a public company of your choice). Make up an investment opportunity for your company and discuss key sensitivities (risks) and possible scenarios. Discuss a few risks or key assumptions and the effects of possible changes in their values.

DQ 2

Discuss some of the factors that would cause you to rely more on either NPV or IRR. Does MIRR solve all of IRR’s shortcomings?

CAPELLA UNIVERSITY BUS4070 UNIT 7 DQ 1 & DQ 2

DQ 1

The debt and equity mix is an example of a financial leverage ratio and indicates the extent to which borrowed funds are used to finance assets. What are the main factors that go into determining the right mix of equity and debt? If debt is always cheaper than equity, why have equity?

DQ 2

You are the owner of a start-up company that is small, but growing fast. To support your growth, you need to purchase some long-term fixed assets. You are considering whether to buy or lease. Why might a financial lease be especially attractive for your situation?

CAPELLA UNIVERSITY BUS4070 UNIT 8 DQ 1 & DQ 2

DQ 1

As an owner of a small company your role doubles as the company’s primary account representative. You are considering ways to reduce working capital and know that one option is to persuade your customers to pay their bills faster. What are some of the advantages and disadvantages to this method should you decide to pursue this option? What are other options you can consider to get customers to pay faster?

DQ 2

The just-in-time (JIT) inventory control system focuses on reducing the amount of inventory a company must carry. Explain how JIT inventory management results in both a one-time cash infusion and an ongoing earnings boost. How does TQM relate to JIT?

CAPELLA UNIVERSITY BUS4070 UNIT 9 DQ 1

DQ 1

Should firms require higher rates of return on foreign projects than on identical projects located at home? Explain. Do not forget the effect of foreign exchange rates

CAPELLA UNIVERSITY BUS4070 UNIT 10 DQ 1 & DQ 2

DQ 1

In the recent merger between Cingular and AT&T wireless, Cingular was forced to sell AT&T assets in several states. Briefly research this merger, including the regulated requirements of the merger. Why do you think Cingular was required to perform these actions as part of the merger? Briefly explain the need to regulate mergers, both domestic and international. In your discussion, be sure to define the term merger and list some motives for mergers.

DQ 2

Explain what a leveraged buyout (LBO) is. Define the term divestiture and briefly discuss the major types of divestitures. Provide reasons a company might consider a divestiture.