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Perking Up Profits at Better Brew and Perfect Blend
After years of dreaming about owning your own business, you decided that owning a coffee shop would be perfect. Rather than start from scratch, however, you and your partners decide to look at two existing establishments, Better Brew and Perfect Blend. The two are for sale at the same price, and they are located in equally attractive areas. You manage to get enough financial data to compare the year-end condition of the two companies, as shown below. Study the numbers carefully; your livelihood depends on choosing wisely between the two establishments.
Better Brew Perfect Blend
Cash $10,000 $25,000
Accounts receivable 2,000 4,000
Coffee equipment 50,000 80,000
Logistics/Supply Chain Management
1. Discuss the three challenges logistics faces as it manages on a process, rather than a functional basis. Describe each challenge and give an example of how it may be overcome.
2. Distinguish among different types of supply chain collaborative relationships. What drives the differences?
Stock favorites in healthcare industries
1. What is your favorite stock at the moment and why?
(Related to the Healthcare industry)
2. Which stock do you find in intriguing, but you haven't made up your mind?
3. If you had a a brokerage account with a million dollars, what brokerage account would you use and what stocks would you buy and why?
WACC, Required Return on Equity, CAPM, IRR & Present Value
WACC: Common stock of the company KewCo. has a beta of 1.3. Treasury Bills provide a return of 4% and the market risk premium is 16%. Suppose KewCo. total value is composed of 60% equity and 40% debt (by market value). Debt yields of 8%. There are no shares of preferred stock in circulation.
a. Find the cost of equity capital for KewCo
b. Suppose KewCo. has a total value, V of $1,000,000,000. If there are 15,000,000 shares of KewCo stock outstanding, what is the current price of a share of KewCo equity?
c. What is the WACC if the firm faces an average tax rate of 40%
d. Suppose KewCo is considering a project with an IRR of 12%, should it accept the project? Why or why not?