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Table Of Contents

1.2.4 Inter-relationship Amongst these Decisions
1.3.1 Value Maximisation is Wealth Maximisation
1.3.2 Objective of Maximization of Profit Pool:
1.3.3 Other Objectives and Value Maximisation Objective
1.3.4 Net Present Value Rule
1.3.5 VMO and NPV Rule
1.4CARDINAL PRINCIPLES OF FINANCIAL DECISIONS:
1.5.1 Compounded Value
1.5.2 Discounted Value
1.6.1 Determination of Implied Interest Rates
1.6.2 Determination of the Implied Principal Amount
1.6.3 Determination of Annuities
1.7BASIC FACTORS INFLUENCING LONG TERM FINANCIAL DECISIONS
1.8SUMMARY
1.9KEY WORDS
1.10SELF-ASSESSMENT QUESTIONS
1.11FURTHER READINGS
1.12ANSWERS
2.1INTRODUCTION
2.2.1 Components of Cost of Capital
2.2.2 Classification of Cost of Capital
2.3.1 Cost of Long-Term Debt
2.3.2 Cost of Preference Capital
2.3.3 Cost of Equity Capital
2.3.4 Cost of Retained Earnings:
2.4.1 Choice of Weights
2.4.2 Computation of The Weighted Cost of Capital
2.5SIGNIFICANCE OF COST OF CAPITAL
2.6SOME MISCONCEPTIONS ABOUT COST OF CAPITAL
2.7SUMMARY
2.8KEY WORDS
2.9SELF-ASSESSMENT QUESTIONS/EXERCISES
2.10 FURTHER READINGS
2.11ANSWERS
3.1INTRODUCTION
3.2CONCEPTUAL FRAMEWORK
3.3CHARACTERISTICS OF IMPORTANT LONG-TERM SOURCES OF FUNDS
3.4.1Cost Principle:
3.4.2Risk Principle:
3.4.3Control Principle:
3.4.4Flexibility Principle:
3.4.5Timing Principle:
3.5.1 EBIT-EPS Analysis for Capital Structure
3.5.2 ROI-ROE Analysis
3.6.1 Net Income (NI) Theory
3.6.2 Net Operating Income (NoI) approach
3.6.3 Modigilian- Miller (MM) Theory
3.6.4 Traditional Approach
3.7FACTORS INFLUENCING PATTERN OF CAPITAL STRUCTURE
3.8RELEVANCE OF DEBT – EQUITY RATIO IN PUBLIC ENTERPRISES
3.9SUMMARY
3.10 KEYWORDS
3.11 SELF ASSESSMENT QUESTIONS/EXERCISES
3.12 FURTHER READINGS
4.1INTRODUCTION
4.2NATURE OF A PROJECT
4.3CLASSIFICATION OF PROJECTS
4.4THE PROJECT LIFE CYCLE
4.5PROJECT MANAGEMENT DEFINED
4.6.1Initial Project Coordination
4.6.2Systems Integration
4.6.3Sorting Out the Project
4.6.4The Work Breakdown Structure and Linear Responsibility Charts
4.7SUMMARY
4.8SELF ASSESSMENT QUESTIONS
4.9FURTHER READINGS
5.1NATURE OF CAPITAL BUDGETING
5.2UTILITY OF CAPITAL BUDGETING
5.3INVESTMENT PROPOSALS AND ADMINISTRATIVE ASPECTS
5.4CHOOSING AMONG ALTERNATIVE PROPOSALS
5.5ESTIMATING CASH FLOWS FOR CAPITAL BUDGETING
5.6.1Payback Method
5.6.2Return on Assets (ROA)
5.6.3Present value method
5.6.4Internal Rate of Return Method
5.7CAPITAL BUDGETING METHODS IN PRACTICE
5.8SUMMARY
5.9SELF ASSESSMENT QUESTIONS
5.10 FURTHER READINGS
7.1INTRODUCTION
7.2DESIGNING OF THE MONITORING SYSTEM
7.3HOW TO COLLECT DATA
7.4INFORMATION NEEDS AND THE REPORTING PROCESS
7.5REPORT TYPES
7.6PROJECT CONTROL
7.7.1Cybernetic Control
7.7.2Go/No-go Controls
7.7.3Post-control
7.8DESIGN OF CONTROL SYSTEMS
7.9CONTROL OF CREATIVE ACTIVITIES
8.2CAPITAL ASSET PRICING MODEL (CAPM)
8.3MEASURING BETAS AND CAPITAL ASSET
8.4STABILITY OF BETAS OVER TIME
8.5BUSINESS AND FINANCIAL RISK
8.6WHAT DETERMINES ASSET BETAS?
8.7DISCOUNTED CASH FLOW APPROACH
8.8SUMMARY
8.9SELF ASSESSMENT QUESTIONS
8.10 FURTHER READINGS
9.1CONCEPT OF CERTAINTY, RISK AND UNCERTAINTY
9.2.1Probability Distribution
9.2.2 Sensitivity Analysis
9.2.3Scenario Analysis
9.2.4 Monte Carlo Simulation
9.2.5Decision Tree Analysis
9.3SUMMARY
9.4SELF ASSESSMENT QUESTIONS
9.5FURTHER READINGS
10.1 INTRODUCTION
10.2 STOCHASTIC GOAL PROGRAMMING MODEL
10.3 GAME THEORY
10.4 THE EXPECTED UTILITY APPROACH
10.5THE EXPECTED UTILITY MODEL
10.6 SUMMARY
10.7 SELF ASSESSMENT QUESTIONS
10.8 FURTHER READINGS
11.1.1Money Market
11.1.2Capital Market
11.2.1Equity Shares
11.2.2Rights Issues
11.2.3Private Placement
11.2.4Non-Voting Shares
11.2.5Preference Share
11.2.6Cumulative Convertible Preference Shares (CCP)
11.2.7Warrants
11.2.8Debentures
11.2.9Bonds
11.2.10 Secured Premium Notes (SPN)
11.2.11 Public Deposits
11.2.12 Bank Credit
11.2.13 Venture Capital
11.3SUMMARY
11.4SELF ASSESSMENT QUESTIONS
11.5FURTHER READINGS
12.1 INTRODUCTION
12.2 DEREGULATION IN FINANCIAL MARKETS
12.7GLOBAL SOURCES OF FINANCING
12.8SUMMARY
12.9 SELF ASSESSMENT QUESTIONS
12.10 FURTHER READINGS
13.1 HISTORICAL SETTING
13.2 FINANCING BY ALL FIs
13.3 ROLE OF BANKS IN TERM FINANCE
13.4 FINANCING NORMS
13.5SHARE OF FIS IN THE COMPANY FINANCING
13.6 REFORMS IN THE DFIS SECTOR
13.7 SUMMARY
13.8 SELF ASSESSMENT QUESTIONS
14.1 INTRODUCTION
14.2.1Leasing and Hire-Purchase
14.2.2Suppliers Credit
14.2.3Asset Securitization
14.2.4Venture Capital
14.3NON-TRADITIONAL SERVICES OF SHORT- TERM FINANCING
14.4 SUMMARY
14.5 SELF-ASSESSMENT QUESTIONS
14.6 FURTHER READINGS
15.1INTRODUCTION
15.2DIVIDEND THEORIES
15.3WALTERS MODEL
15.4GORDON’S MODEL
15.5MODIGLIANI – MILLER HYPOTHESIS
15.6PROCEDURE OF PAYING DIVIDENDS
15.7TYPES OF DIVIDENDS
15.8FACTORS INFLUENCING THE DIVIDEND POLICY
15.9DIVIDEND STABILITY
15.10 DICIDING THE DIVIDEND PAY OUT RATIO
15.11 SUMMARY
15.12 SELF ASSESSMENT QUESTIONS
15.13 FURTHER READINGS
16.1INTRODUCTION
16.2FACTORS CONTRIBUTING TO FINANCIAL ENGINEERING
16.3FINANCIAL ENGINEERING PROCESS
16.4FINANCIAL ENGINEERING IN FIXED INCOME SECURITIES
16.5FINANCIAL ENGINEERING IN EQUITY PRODUCTS
16.6FINANCIAL ENGINEERING IN DERIVATIVES
16.7SUMMARY
16.8SELF-ASSESSMENT QUESTIONS
16.9FURTHER READINGS
17.3DEMAND FOR INFORMATION
17.4TRANSPARENCY AND DISCLOSURE
17.5CORPORATE GOVERNANCE
17.6INVESTOR SERVICE
17.7SUMMARY
17.8SELF-ASSESSMENT QUESTIONS
17.9FURTHER READINGS
18.1INTRODUCTION
18.2CORPORATE RESTRUCTURING
18.3FINANCIAL RESTRUCTURING
18.4ASSESSING MERGER AS A SOURCE OF VALUE ADDITION
18.5FORMULATING MERGER AND ACQUISITION STRATEGY
18.6REGULATION OF MERGERS AND TAKE OVERS IN INDIA
18.7TAKE OVER STRATEGIES: INDIAN EXPERIENCE
18.8DIVESTITURES
18.9CHARACTERISTICS OF AND PRE-REQUISITIES TO LEVERAGED BUYOUT SUCCESS
18.10 LEVERAGED RECAPITALIZATION
18.11 REORGANIZATION OF CAPITAL
18.12 FINANCIAL RECONSTRUCTION
18.13 SUMMARY
18.14 KEY WORDS
18.15 SELF ASSESSMENT QUESTIONS
18.16 FURTHER READINGS
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MS 42 Except Ch 6

MS 42 Except Ch 6

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Published by: pravinkolhe on Jan 17, 2012
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