Module 1
Q Provide a brief description of the company that is chosen and the developments in history of the company.
The roots of British Petroleum can be traced to the Iran and the efforts for oil exploration in the region at the inception of the twentieth century. When the first commercially viable find of the Middle East was unearthed in Iran, the Anglo-Persian Oil Company was formulated in the year 1909. After a brief placid existence, the outfit began to lobby heavily with the political forces...
The cost of equity
In calculating cost of equity for this company Capital Asset Pricing model is used. This model estimates profitability of financial assets that are used. This model is used as a theoretical basis for a number of various financial methods of earnings and risk management in a long-term and mid-term investment decisions. CAPM considers profitability of assets depending on the market behavior as a whole( Fama and French, 2004, p. 26).
According to CAPM the risk from investing in any financial...
The Cost of Equity
Estimating the cost of equity for any firm is a task which requires a lot judgment and estimation. Different methodologies and theories exits on the best way to calculate the cost of equity which is basically the rate of return investors require on their investors. After careful consideration we are to present to the esteemed Board the findings on the subject. The dividend growth model provides the best estimate of the cost of equity. While it has its limitations, it uses dividends, the only cash...
A Create Value A Corporate Governance Perspective
INTRODUCTION
Background
Mergers and acquisitions are pervasive occurrences. Estimates by the International Labour Organization indicate that each year there are close to 4,000 mergers and acquisitions which are carried out (ILO, 2001). According to the United Nations Commission on Trade and Development, the past 3 decades have seen a 40 expansion in the total value of mergers and acquisitions globally. There were a total of 24,000 mergers and acquisitions which generated more than 2.3 trillion as...
Topic Small and Medium-sized Enterprises Risk Management and Internal Control
With the change in business environment, it has become necessary for organizations to focus on sustainable wealth creation. Some organizations have invested substantially in risk management and internal control measures. Risk management is the identification and assessment of risks and the application of resources to prevent, monitor and control the chance, and impact of an eventuality. It is very clear that appropriate responses must be prepared to counter any risk that would affect business strategies...