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Mini-project Goal: The goal is to use compound interest (CI), spot rates, yield curve, bond pricing and other possible interest theoretical analysis to investigate and

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Mini-project Goal: The goal is to use compound interest (CI), spot rates, yield curve, bond pricing and other possible interest theoretical analysis to investigate and compare financing plans. You should use your writing skills, learned interest terminologies, and formulas to clearly communi- cate your suggested financing resolution. Role: You are the financial consultant for some firms to seek possible financing plan. Such firms are in need of financial advice but not sure which is the most appropriate financing strategy. Situation: Suppose you are hired as a financial consultant to help some firms to raising money from market, and determine the best options for their financing plans. Utilizing your interest theory knowledge, you need to convince the firms of the best option for their financing. Scenario: Suppose you can access the possible future (expected) cash flow from firms's basic business operations (i.e., the firms fixed or random incomes in next 30 years); you can also observe the current market bond prices in next 30 years (but for other firms or governments); also, you also can get known the basic lending rates from main business banks (for possible amortization or sinking fund method). Hints: You may suggest choose borrowing money from bank using amortization or sinking fund in this case, the firms will pay some interests), or issue some bond in market in this case, the firms will pay some coupons). Remarks: This mini-project is open for all possible solutions, no fixed answer and you are free to propose your suggestion or show your ideas. Two single-side A4 pages are limited (thereby, please focus on your basic idea, blue picture with minimal necessary justifications only). Mini-project Goal: The goal is to use compound interest (CI), spot rates, yield curve, bond pricing and other possible interest theoretical analysis to investigate and compare financing plans. You should use your writing skills, learned interest terminologies, and formulas to clearly communi- cate your suggested financing resolution. Role: You are the financial consultant for some firms to seek possible financing plan. Such firms are in need of financial advice but not sure which is the most appropriate financing strategy. Situation: Suppose you are hired as a financial consultant to help some firms to raising money from market, and determine the best options for their financing plans. Utilizing your interest theory knowledge, you need to convince the firms of the best option for their financing. Scenario: Suppose you can access the possible future (expected) cash flow from firms's basic business operations (i.e., the firms fixed or random incomes in next 30 years); you can also observe the current market bond prices in next 30 years (but for other firms or governments); also, you also can get known the basic lending rates from main business banks (for possible amortization or sinking fund method). Hints: You may suggest choose borrowing money from bank using amortization or sinking fund in this case, the firms will pay some interests), or issue some bond in market in this case, the firms will pay some coupons). Remarks: This mini-project is open for all possible solutions, no fixed answer and you are free to propose your suggestion or show your ideas. Two single-side A4 pages are limited (thereby, please focus on your basic idea, blue picture with minimal necessary justifications only)

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