Week 3, Chapter 3
Article Review and Reflection
DUE DATE: Wednesday, March 13
20 Points
Please read the Harvard Business Review article “Better Brainstorming” which is found in this assignment folder.
After reading this article, write a one to two page article review and reflection that addresses the following points:
1. Summarize the main highlights (topics) of the article. (Two to three paragraphs in length)
2. Explain the significance of this article and how the concepts within this article relate to entrepreneurship (One to two paragraphs in length)
3. Reflect on what you read and identify at least two concepts from the article that you either agree or disagree. Explain why you either agree or disagree with the author. (One to two paragraphs in length)
Articles need to be written using either Calibri or Times New Roman font, 11-point size, with 1.5 spacing. Your header should be the following:
Name
ENT 311
Spring 2019
Article review CH 3
Please submit your assignment via Blackboard by Wednesday, March 13. Please let me know if you have any questions about this assignment.
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4 assignment requirement. Please utilize 5 sources for each assignment and have at least 10 different in text citations. utilize the template provided. Early submission is appreciated. Please conduct all calculations on excel as described below.
Topic 1: Prof. Ed’s video and image resources. I have put together the following multimedia resources (i.e., videos and images) to help you learn about the concepts we’ll be exploring in this course. You can find them at the hyperlink below:
You are also welcome to visit my entire website devoted to students of Accounting and Finance by visiting http://www.penn-oaks.com/.
Topic 2: Module 1 case 1. Module 1 Case 1 is really designed to give you the opportunity to work with time value of money concepts. I hope that all of you will choose to work them using Excel functions, but you are also welcome to tackle time value of money concepts with Excel formulas, with calculators (either online or physical), or with tables. Ideally, you will all submit your work as an Excel file, but you are welcome to submit your work as a Word or .pdf file as well.
Be sure to take advantage of my video and image (i.e., multimedia) presentations since I work through many time value of money exercises for you.
Topic 3: Finance topics document. Class, I came across this Finance Topics document. It contains many useful concepts related to the topics we explore in this course. I think the most useful part of this document falls under Topic 1.1b, “Ten Principles that form the foundation of Financial Management.” You may find some of these principles helpful to you as you tackle the graded assignments and discussions in this course. You can view and download it from the hyperlink below.
Topic 4: Do not post early in the discussions. Our class discussions have starting and ending dates. Posting early is equivalent to speaking to the class before they arrived, just as posting late is equivalent to speaking to the class after everyone has left.
If you have posted early, please be sure to make an EXTRA value-added post, since the post you made early will not count, and please do not post early in all future discussions.
Topic 5: Discussion Expectations. In each graded discussion, I wanted to share my expectations about what I’m looking for.
Keep in mind that you will graded using the discussion grading rubric. I have attached an image of it at the bottom of this post.
I will be looking for a minimum of three discussion posts in each graded discussion (but keep in mind that posting the minimum does not mean that you will earn the maximum score). You can expect to earn the maximum score when you make five or more value-added posts in each graded discussion.
I will be looking to see that you participated on at least three unique days in each graded discussion. If you cannot participate on three unique days, but still make meaningful posts, you can expect to earn a score that will not exceed 89%.
Late discussion participation will earn only partial credit. The discussions are meant for maximum student participation and should take place during the time frame in which they are scheduled. For late posts in our graded discussions, only your original discussion post will be graded (since at the time you will be posting in the discussion all others will have already moved on to a subsequent discussion in a subsequent module). Full credit won’t be possible, since you would not have participated with others on a timely basis (and the discussions are designed for maximum student participation). Expect partial credit for late discussion posts to fall near 70% but no higher.If you do make your original discussion post late in any module, you must contact me to let me know. You can either make a post in the ungraded Questions, Ask area of the Cyber Café, or you can contact me via email at edward.kaplan@trident.edu. If you don’t contact me, I won’t know that you have posted late in an earlier module, since I grade in batch and once I grade, I don’t go looking for late posts.
Single-sentence posts earn no credit, and simple “I agree” or “Nice work fellow student” posts will not earn any credit. It is okay to agree with or compliment your fellow classmates, but you must then follow up with some substantive comments as well.
Posts that are nothing more than the exact words of others earn no credit, even if they appear in quotes and are properly referenced. I think it is great and very beneficial when students discover relevant information to our discussion topics from other sources they have found over the internet. In the discussion threads, the correct way to post information you have found involves summarizing what you have found (in your own words) and then providing the web link to where the source of your summary originated. If the link has a few ideas that you want to quote word for word, you certainly can do that. Just be sure you put those words in quotes so everyone reading your post understands you are quoting the work of others. Your posts should never simply be a cut and paste of someone else’s words–even if it appears in quotes and has the web site listed as a reference. Instead, summarize the main points and provide the web link. That way, it is clear you understand how the topic relates to our discussion and others interested in learning more can visit the web site you have provided.
Posts made early earn no credit and should be avoided.
Module 1 – Case
PRESENT VALUE AND THE RISK/RETURN TRADE-OFF
ASSIGNMENT OVERVIEW
For this assignment, make sure to first carefully review all of the required readings about present value, future value, risk and return, and the CAPM. Once you are relatively comfortable with these concepts, try working through some of the examples in the background readings and try computing the answers on your own. Once you are confident you both understand the concepts and the computational steps, complete the assignment below.
CASE ASSIGNMENT
Present your answers to the problem below in a Word document, and also upload an Excel file with your computations. Excel is required for Questions 2 and 3. Excel is optional for Questions 1 and 4, but you are required to show your steps for all quantitative problems. Even if you get the answer wrong, you can still get partial credit if you show your work.
Calculate the following:
Suppose you wish to raise some money for your favorite local charity. This charity needs $50,000 a year to run its operation and you want to make sure that it is ensured an annual payment of this amount from now on for every year in the foreseeable future. Given an interest rate of 5%, how much would you have to fund this perpetuity to guarantee the charity a payment of $50,000 per year?
You decide to put $1,000 in a new bank account and don’t plan to withdraw the money for 10 years. If your bank does continuous compounding and the interest rate is 1%, what will be the value of this bank account in 10 years?
Suppose you won the lottery but not all of your winnings will come in one year. Instead, you will get a series of annual payments over the next five years. The table below tells you what your payment will be every year for the next five years. Use the information in the table to make the following computations:
The present and future value of your lottery ticket if the interest rate is 8%
The present and future value of your lottery ticket if the interest rate is 10%
Year
Payment
1
5000
2
6000
3
7000
4
8000
5
9000
The table below gives the probability of different returns for three different assets. Using this table, calculate the following:
The expected return of each asset
The standard deviation of returns of each asset
The coefficient of variation of each asset
Based on your answers to B) and C) above, which asset has the highest total risk and highest relative risk?
Asset A
Asset B
Asset C
Probability
Return
Probability
Return
Probability
Return
0.3
5
0.1
25
0.1
4
0.4
8
0.3
20
0.8
5
0.3
9
0.5
15
0.1
6
0.1
14
Suppose the market return is 8%, the risk-free rate is 1% and the beta for a given stock is 1.2. Answer the following questions based on this information:
What is the required return for this stock?
If the beta increases by 50% (but risk-free rate remains 1%), what will be the new required return for the stock? What is the percentage-wise change in required return compared to your answer to A) above?
If the market return increases by 50% (but beta remains at 1.2), what will be the new required return for the stock? What is the percentage-wise change in required return compared to your answer to A) above?
Suppose there are three different companies. The first one, Trendy Tech Inc., has investors who are “fair-weather friends.” When the stock market is going up, everybody wants to invest in Trendy Tech, but as soon as the market goes down everyone jumps ships and sells their shares. The second company is Oily Oil Inc. Oily’s stock price seems to depend only on the price of oil and nothing else. Finally, there is Conglomerated Conglomerate Inc. Conglomerated is a giant company with holdings in almost every industry imaginable—from cell phones to grocery stores and even amusement parks. Based on this information, which company would you think has the highest beta? The lowest beta? Which one do you think has a beta closest to 1?
ASSIGNMENT EXPECTATIONS
Answer the assignment questions directly.
Stay focused on the precise assignment questions. Do not go off on tangents or devote a lot of space to summarizing general background materials.
For computational problems, make sure to show your work and explain your steps.
For short answer/short essay questions, make sure to reference your sources of information with both a bibliography and in-text citations. See the Student Guide to Writing a High-Quality Academic Paper, including pages 11-14 on in-text citations. Another resource is the “Writing Style Guide,” which is found under “My Resources” in the TLC Portal.
Module 1 – Background
PRESENT VALUE AND THE RISK/RETURN TRADE-OFF
To begin the module, start off with these two videos to give yourself an overview of the main concepts covered in this module. The first video is from Professor Holthausen of the Wharton School of Business at the University of Pennsylvania. He explains the concept of the time value of money and also goes through some calculations using Microsoft Excel. The second video is from Professor Pinder of the University of Melbourne and covers some basic concepts of risk and return.
A second video from Dr. Pinder on the capital asset pricing model is highly recommended but not required. A link to Dr. Pinder’s video is included under the optional reading list below.
Once you have finished viewing the videos, take a closer look at the concepts covered in the videos by reading through these book chapters. In addition to reading about the basic concepts, make sure to work through some of the numerical examples as these will help you with your assignments:
time and money scale
Vishwanath, S. (2007). Chapter 2: Time value of money. Corporate finance: Theory and practice. SAGE Publications India. Available in the Trident Online Library.
risk and reward tightwire
Vishwanath, S. (2007). Chapter 3: Risk and return. Corporate finance: Theory and practice. SAGE Publications India. Available in the Trident Online Library.
If you have any difficulty with the material above, it is highly recommended that you take a look at some of the optional readings below. The materials below cover the same material but sometimes concepts can be absorbed better if you see some explained in a different manner or see additional examples.
Finally, if you don’t have much experience with Microsoft Excel then please take a look at the following videos:
Module 2 – Case
STOCK AND BOND VALUATION
ASSIGNMENT OVERVIEW
Before starting on this assignment, make sure to thoroughly review the required background materials. This assignment will require you to use the various discounted cash flow methods and dividend models to make computations. In addition to knowing the computational steps involved in stock and bond valuation, make sure you also understand the basic concepts.
Submit your answers as a Word document. Make sure to show your work for all quantitative questions, and make sure to fully explain your answers using references to the background readings for any conceptual questions. Questions 1 and 3 will require Excel, so submit an Excel file that shows your computational steps as a separate file in addition to your Word file. Question 4 is purely conceptual, no computations are necessary but make sure to apply and reference concepts from the required readings in your answers to each of the scenarios.
CASE ASSIGNMENT
Suppose you buy a bond that will pay $1000 in ten years along with an annual coupon payment of $50 and the interest rate is 4%. Answer the following questions:
What is the value of this bond?
Now suppose the bond has no coupon payments (it is a “zero coupon” bond) but still pays $1000 in ten years. What is the value of this bond?
What would happen to the value of the bond if the inflation rate unexpectedly goes up? What the bond value increase or decrease?
Now suppose the bond still pays an annual coupon of$50 but the interest rate drops to 2%. What is the new value of this bond?
The XYZ Corporation pays a dividend of $1 for each share and its required rate of return is 8%. Answer the following questions:
Assuming zero growth in dividends, what is the value of each share?
Now assume a 4% annual growth rate in the dividend paid. What is the value of each share?
Assume the growth rate is still 4%, but the required rate of return drops to 6%. What is the new value of each share?
Acme Medical Corp. is expecting the cash flows from 2018-2022 in the table below. After 2022 it is expecting growth in cash flow at an annual rate of 3%. The firm has determined that its weighted average cost of capital (discount rate) is 7%. Using the table below calculate the following:
What is the present value of Acme’s future cash flows using the discounted cash flow model?
If the firm has 200,000 common shares outstanding, zero preferred shares, and debt with a market value of $10,000,000 what would be the value of each share?
Now suppose the discount rate increases to 10%. How would your answers to a) and b) above change based on the new discount rate?
Year
Cash flow
2018
500,000
2019
550,000
2020
620,000
2021
700,000
2022
800,000
Suppose the Alpha Manufacturing Corporation is experiencing extreme financial difficulties and is considering bankruptcy. Its shareholders are currently almost equally divided about whether or not the company should go bankrupt, with one outspoken faction pushing for bankruptcy and the other strongly opposing it. They have $50 million in debt all in the form of bonds, and bondholders are pretty well united in that they want the firm to declare bankruptcy.
The CEO announces that he is leaning against bankruptcy. This means one faction of shareholders is happy, but another faction of shareholders is very upset and the bondholders are also unhappy. Can the unhappy faction of shareholders team up with the bondholders to vote out the CEO? Explain your reasoning using references from the background readings.
Suppose Alpha ends up declaring bankruptcy. They do not have any cash in the bank but they own $60 million worth of real estate. They only have one type of shareholder—common shareholders. If they sell the real estate, how much of this will bondholders get and how much with shareholders get? Explain your reasoning using references from the background readings.
Now suppose that Alpha has two classes of shareholders—common shareholders and preferred shareholders. Preferred shareholders are owed $20 million in dividends that have been unpaid in the last two years. If Alpha goes bankrupt and sells its $60 million worth of real estate, how much will bondholders get, how much will common shareholders get, and how much will preferred shareholders get? Explain your reasoning using references from the background readings.
ASSIGNMENT EXPECTATIONS
Answer the assignment questions directly.
Stay focused on the precise assignment questions. Do not go off on tangents or devote a lot of space to summarizing general background materials.
For computational problems, make sure to show your work and explain your steps.
For short answer/short essay questions, make sure to reference your sources of information with both a bibliography and in-text citations. See the Student Guide to Writing a High-Quality Academic Paper, including pages 11-14 on in-text citations. Another resource is the “Writing Style Guide,” which is found under “My Resources” in the TLC Portal
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Strategic Plan
Prior to completing this assignment, review your prior research and course submissions related to the
company you selected for research in Week 2’s Environmental Scanning interactive assignment.
Ensure that you have incorporated the feedback you received from your previous submissions. In your
Final Project this week, you will pull the various elements you’ve created together to aid your creation of a Strategic Plan. From the perspective of an executive with the firm, your supervisor has tasked you with creating a strategic plan to grow the business over the next three years using this Strategic Plan Template . Continue to access the Mergent Ashford University Library online database which offers company financials, descriptions, history, property, subsidiaries, officers, and directors and the Business Insights database. (View the Mergent tipsheet and Business Insights tipsheet Tips
document for suggested methods of searching Ashford University Library databases generally as well as specific advice for searching these two databases).
Your strategic plan must be future oriented and must
Describe the company, the company’s history and its 4Ps (Product, Price, Place, and Promotion).
Examine the company’s mission statement and assess its impact on the organization’s activities.
Explain the current situation of the organization in the market (industry, market, and general
environment analysis).
Add your SWOT analysis (strengths, weaknesses, opportunities, and threats) of your chosen company here. Evaluate areas that offer opportunities.
Choose three or four areas from your SWOT analysis and assess why the areas you have chosen are essential to your strategic plan
Summarize the results of your Environmental Scan and Porter’s 5 Forces.
Evaluate the degree to which they aid in conceptualizing the company’s competitive position in its marketplace.
Assess the company’s international performance in light of Cultural Barriers, Monetary Exchange
Rates, and Political Instability.
Assess the financial performance and condition of the Operational budget: Research and assess the company’s operational budget.
Assess the performance in terms of key performance indicators.
In your analysis, be sure to include profitability ratios relevant to your analysis.
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Company Outsourcing Parts of its Supply Chain Why would a company outsource parts of its supply chain? Explain the value of this practice and why so many companies use it today.
Company Outsourcing Parts of its Supply Chain
What are some operational challenges that outsourcing can present? That’s why some companies choose to outsource their SCM and leave it to a third-party organization. While this isn’t for everyone, it can be suitable for many businesses. Here are some of the inherent risks and benefits of outsourcing SCM to help you decide if it’s right for you. At first glance, the improved efficiency and financial savings may look appealing.
“Critically evaluate how “open innovation” has transformed business strategy with reference to a company (or organization) of your choice. Comment on Michael Porter’s (2001) claim that the fundamentals of strategy remain unchanged”
I’ve tried my best to deliver an answer to both parts of the assignment. However, since I’m of Portuguese nationality I do have some difficulties regarding the overall approach and structuring of an essay.
I’m not very happy with the work I have done and would really appreciate all the help I can get.
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Write a six to eight (6-8) page paper in which you:
Analyze the business-level strategies for the corporation for Walmart to determine the business-level strategy you think is most important to the long-term success of the firm and whether or not you judge this to be a good choice. Justify your opinion.
Analyze the corporate-level strategies for the corporation you chose to determine the corporate-level strategy you think is most important to the long-term success of the firm and whether or not you judge this to be a good choice. Justify your opinion.
Analyze the competitive environment to determine the corporation’s most significant competitor. Compare their strategies at each level and evaluate which company you think is most likely to be successful in the long term. Justify your choice.
Determine whether your choice from Question 3 would differ in slow-cycle and fast-cycle markets.
Use at least three (3) quality references one is already provided. Note: Wikipedia and other Websites do not quality as academic resources.
Introduction
Write your brief introduction here: It should not be more than 1 good paragraph (about 5 complete sentences) to introduce the reader to your topic and it should explain in detail what your paper will be discussing. Much of your introduction may be taken from the assignment itself (in your own words). Read the scenario to get a feel for what the paper is about and explain what your paper will be discussing – so be sure to review the Assignment instructions AND Rubric for understanding. Finally, please ask me any questions about this assignment.
Business-Level Strategies
Analyze the business-level strategies for the corporation you chose to determine the business-level strategy you think is most important to the long-term success of the firm and whether or not you judge this to be a good choice (Note: in this step you need to choose and write about only one (1) business-level strategy from the text book (not Google). Justify your opinion. For background, be sure to research and explain the industry in which your selected corporation operates. You could also briefly (1 – 2 sentences) define the business-level strategy (cite your sources) and briefly (1 – 2 sentences) define the strategy you are writing about using the textbook/Learn, as an introduction to your analysis. Read Chapter 4 in the course textbook. Review the Week 4 Learn video/Lecture for supporting content. In this section, you will want to research and identify the core competencies of your chosen firm. Demonstrate from your research how the firm uses its core competencies to create and sell its products in the marketplace. What actions & choices has the firm made to compete in individual product markets? Hint: “Every firm must form and use a business-level strategy.” (Hitt, Ireland, & Hoskisson, 2013, pp. 102). Review Chapters 4-9 for specifics on the business-level strategies.
Corporate-Level Strategies
Analyze the corporate-level strategies for the corporation you chose to determine the corporate-level strategy you think is most important to the long-term success of the firm and whether or not you judge this to be a good choice (Note: in this step you need to choose and write about only one (1) corporate-level strategy from the text book (not Google). Justify your opinion.
You should briefly define (1 – 2 sentences) corporate-level strategy based upon the textbook/lectures (cite your sources) as part of your analysis. Read Chapter 6 in the course textbook. Review the Week 6 Learn video/Lecture for supporting content.
Competitive Environment
Analyze the competitive environment to determine the corporation’s most significant competitor (this will require research/cite your sources). Compare their strategies at each level (market commonality, resource similarity, competitive behavior, and competitive dynamics/actions/responses) and evaluate which company you think is most likely to be successful in the long term. Justify your choice. Hint: read Chapter 5 in the course textbook as it provides a solid background and clues on this model that apply to this section. Review the Week 4 Learn video Lecture for supporting content (cite your sources).
Market Cycles
Determine whether your choice from Question 3 (Competitive Environment section above) would differ in slow-cycle and fast-cycle markets. It would be a good idea to briefly explain what the slow-cycle and fast-cycle markets are from the textbook (cite your sources) as a short introduction to your determination. Hint: read Chapter 5 in the course textbook with a special focus on the Competitive Dynamics section. Review the Week 4 Learn video Lecture for supporting content (cite your sources).
Sources
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2013). Strategic management: Concepts and cases: Competiveness and globalization (10th ed.). Mason, OH: South-Western Cengage Learning.
Use at least three (3) quality references, one of which should be the course textbook.
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Identify where the brand is in the product/brand life cycle (introduction, growth, maturity, decline) and support your position with specific examples and research.
Create a 700- to 1,050-word marketing strategy based on this position in the life-cycle:
Identify appropriate marketing tools
Assess challenges and opportunities as they relate to its niche, competition, and position in life cycle
Cite all sources according to APA formatting guidelines.
Use at least three (3) quality references Note: Wikipedia and other related websites do not qualify as academic resources.
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Strategy Proposal on Job Discrimination 1. Needs. What is the issue you have chosen? Why is your group passionate about this issue, and how specifically does it impacts the lives of real people?
Strategy Proposal on Job Discrimination
What are the obstacles that have kept positive change from happening so far? How does our reading so far – and your own research – help us understand how the issue works? Most importantly, you and your peers have talked to real people: directly cite observations from interviews and surveys (bonus for qualitative and quantitative) to support your points.*
Strengths. Describe in detail a community you are hoping to serve, using quotes from a Needs & Strengths Assessment to create a rich description. How can the identity and experience of this community be a strength? What other resources and insights can they bring to bear on this issue? What do readings and research tell us about how this issue should be addressed? Name at least two institutions working on this issue or a similar one. What is their approach, and what flaws or gaps do you see?
Intervention model. What strategies do you propose to address this issue, and why did you choose them? Limit this to 1-2 strategies – this should be a deep exploration rather than a list. How specifically does each strategy work, and how do they work together? How do they use knowledge from our course readings to increase their impact? What are other models, and why are yours more efficient and impactful? What resources will you need and how will you get them?
Impacts. What vision is your strategy building toward – i.e., if all goes well, how will inequality look different 50-100 years from now? What are short term benchmarks that you would need to accomplish in the next year to put this in place? What are measurable changes in the medium-term (5 years) that will tell you if it’s working or not? Name 2-3 challenges you think will stand in the way of your vision: how will you learn from these challenges and use them to make your model better?
An on-line retailer that sells home and children’s items, such as children’s furniture, clothing, and toys, was seeking a way to reach a new audience and stop the declining sales and revenue trends it was suffering. A market research firm hired by the retailer identified a new but potentially risky market: lower-income single parents. The new market seemed attractive because of the large number of single parents, but most of these households were severely constrained in terms of their monetary resources.
The research firm proposed that the retailer offer a generous credit policy that would allow consumers to purchase up to $500 worth of merchandise on credit without a credit check, provided they signed up for direct payment of their credit account from a checking account. Because these were high-risk consumers, the credit accounts would carry much higher than normal interest rates. The research firm believed that even with losses, enough accounts would be paid off to make the venture extremely profitable for the on-line retailer.
You work in logistics at Faker, Inc., an import company that buys counterfeit items from suppliers in China. Faker brings these items into the US and sells them on the streets of New York, employing over a hundred “hawkers”, all paid on commission and all making a good living. All of the “hawkers” are trained not to lie about the genuineness of whatever they are selling. In fact, Faker management encourages the “hawkers” to “tell the truth” about what customers are buying. Faker’s position is “no harm, no foul”. In fact, Faker’s CEO frequently states that the company corporate culture is one of honesty, integrity and creativity.
You are having some “issues” with the ethics of this company. You ask your trusted Ethics instructor what you should do. He suggests that you write down your thoughts on the matter by answering the following questions:
Could Jeremy Bentham justify the continued existence of Faker? Explain.
If Immanuel Kant worked at Faker, how would he feel about the corporate culture? Why?
Do you agree with the CEO’s description of the corporate culture at Faker? Why?
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Conduct Internet research to locate two strategic plans that are relevant to your work and/or area of interest (Higher Education). Review the two plans in conjunction with the strategic planning guidelines attached, and pick one of your strategic plans to use in this assignment.
Using the guidelines as a framework, summarize the key information from your chosen strategic plan in an outline with the 10 section titles as subheads. Note whether any information is missing or presented alternatively. (e.g., if there is not a SWOT analysis, but a different type of analysis, note this in your outline).
Use at least three (3) quality references Note: Wikipedia and other related websites do not qualify as academic resources.
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