Description
The rubric is the most important guideline to acheiving this assignment. please follow painstakingly.
Overview
In this Short Answer Assessment, using the practice problems in the textbook
(Fundamentals of Financial Management, 2013) you will answer a series of
short answer items to demonstrate your ability to use multiple techniques to
evaluate long-term capital position and needs.
Access the following to complete this Assessment:
•
•
Text: Fundamentals of Financial Management, 13th Edition (2013)
SF004 Short Answer Submission Form (with Rubric)
Instructions
Before submitting your Assessment, carefully review the rubric. This is the
same rubric the assessor will use to evaluate your submission and it provides
detailed criteria describing how to achieve or master the Competency. Many
students find that understanding the requirements of the Assessment and the
rubric criteria help them direct their focus and use their time most productively.
To complete this Assessment:
•
•
Download the Academic Writing Expectations Checklist to use as a guide
when completing your Assessment. Responses that do not meet the
expectations of scholarly writing will be returned without scoring. Properly
formatted APA citations and references must be provided where
appropriate.
Download the SF004 Short Answer Submission Form, which includes the
Rubric for this Assessment. Complete the form adhering to the criteria
presented in the Rubric.
This Assessment requires submission of one (1) document, a completed
Short Answer Submission Form. Save this file
as SF004_firstinitial_lastname (for example, SF004_J_Smith). When you
are ready to upload your completed Assessment, use the Assessment tab on
the top navigation menu.
SF004: Sources and Uses of Short-Term Capital
Short Answer Submission Form
Your Name: First and last
Your E-mail Address: Your email here
Instructions
This Competency includes a Short-Answer Response Assessment. Write your response to each prompt below in the space provided. The Rubric,
which will be used by the Competency Assessor to evaluate your responses, is beneath the prompts. Carefully review the Rubric rows associated
with each prompt to provide a complete response.
When writing your response, begin typing where it reads “Enter Your Response Here.” Write as much as needed to satisfy the requirements of
the prompt (as defined in the Rubric). Be sure to support your responses with connections to professional sources.
Your Assessment responses require references (in APA style) to support your thinking. You will list your references at the end of this template
where “References” are noted. If you need additional information regarding how to correctly cite, and/or reference sources, please visit the
Walden Writing Center at http://academicguides.waldenu.edu/writingcenter/apa/citations
To learn more about effective paraphrasing strategies, visit the Walden Writing Center at
http://academicguides.waldenu.edu/writingcenter/evidence/paraphrase/effective
©2015 Walden University
1
Review the following example item and response for a sample that meets expectations.
Sample Prompt:
Choose a definition of organizational culture, and explain whether you agree or disagree with the definition. Use examples from your
own professional experience to support your response.
Response:
Whitehurst (2016) explained “organizational culture is defined by how people in an organization interact with each other” (para. 2).
While I agree that this is one aspect of organizational culture, the definition does not capture the complex factors that contribute to
organizational culture. When I started my first job after finishing my undergraduate degree in business, I worked for an organization
whose main headquarters were in Dubai. When I traveled to Dubai for the first time, I realized that the culture of the Dubai office was
largely influenced by the society’s culture in Dubai. I found that the organization lacked one cohesive culture and that, depending on
regional locations, each office had its own culture. International organizations often face many challenges in maintaining a cohesive
organizational culture (Watkins, 2013). I found this observation to be true in my experience. For example, the Dubai office seemed to
endow their employees with more allowance for self-direction when compared with our domestic offices. Although people’s
interactions with one another contributed to the organization’s culture, there were other factors like location, management style, and
societal norms that impacted a business culture as well.
References
Watkins, M. D. (2013, May 15). What is organizational culture? And why should we care. Harvard Business Review. Retrieved from
https://hbr.org/2013/05/what-is-organizational-culture
Whitehurst, J. (2016, October 13). Leaders can shape company culture through their behaviors. Harvard Business Review. Retrieved from
https://hbr.org/2016/10/leaders-can-shape-company-culture-through-their-behaviors
Note: References are included at the end of a Short-Answer Assessment but are included here as an example of an accurate APA
reference list.
©2015 Walden University
2
1.
Time Value of Money: Review the examples of Time Value of Money (TVM) problems in Chapter 5 of the text. (Fundamentals of Financial
Management, 13th Edition)
•
•
Using your own industry as the context, create and solve four of your own original TVM problems: (1) lump-sum present value, (2)
lump-sum future value, (3) present value of an annuity, and (4) future value of an annuity. Your scenarios may be fictitious, but they
should make sense in the real-life context of your industry.
Write a 1-paragraph summary for each of your scenarios that explains the “real-life” context of these four problems as well your
interpretations of each of the calculations. (4 paragraphs total)
Your Response
Enter your response here
Rubric
0
Not Present
1
Needs Improvement
2
Meets Expectations
3
Exceeds Expectations
Sub-Competency 1: Compute various time value of money (TVM) problems (future value, present value, annuities).
Learning Objective 1.1:
Create and solve TVM
problems.
Learning Objective 1.2:
Solve TVM problems
based on experience in
an industry.
TVM problems and
solutions are missing.
TVM solutions to problems
based on experience in an
industry are missing.
Response does not include
four TVM problems: (1)
lump-sum present value,
(2) lump-sum future value,
(3) present value of an
annuity, and (4) future
value of an annuity.
Response includes four
TVM problems: (1) lumpsum present value, (2)
lump-sum future value, (3)
present value of an
annuity, and (4) future
value of an annuity.
TVM problems do not use
plausible numbers/figures
for industry application.
TVM solutions are
inaccurate.
TVM problems use
plausible numbers/figures
for industry application.
TVM solutions are
accurate.
TVM solutions are not
documented in detail.
TVM solutions are
documented in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Response relates problems
to real-world examples
within a specific industry.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
TVM solutions are clearly
©2015 Walden University
3
Learning Objective 1.3:
Explain how the TVM
problems and solutions
reflect the real-life
business context of a
specific industry with
which the student is
familiar.
2.
0
Not Present
1
Needs Improvement
Explanation of how TVM
problems and solutions
reflect the real-life context
of a specific industry with
which the student is
familiar is missing.
Explanation does not
clearly connect the data
used in the TVM problems
with a real-life industry
context.
Explanation is not framed
in terms of industry
context and/or
parameters.
2
Meets Expectations
Explanation clearly
connects the data used in
the TVM problems with a
real-life industry context.
Explanation of solutions is
framed in terms of
decision making that could
be considered.
3
Exceeds Expectations
related to real-world
examples within a specific
industry.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Response includes one or
more additional problems
and solutions.
Bond Valuation: Do problem 7-6, Part a, on page 251. (Fundamentals of Financial Management, 13th Edition)
3. Bond Pricing Interpretation: Explain what you see from the pricing calculations. How do the two bonds differ? (1 paragraph)
Your Response
Enter your response here
Rubric
Sub-Competency 2: Compute the value of a bond with various rates and terms.
Learning Objective 2.1:
Calculates the prices of
two bonds at 0, 1, 2, 3,
and 4 years to
maturity.
Calculation of the prices of
two bonds at 0, 1, 2, 3, and
4 years to maturity is
missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
©2015 Walden University
4
Learning Objective 2.2:
Analyze the prices for
two bonds at 0, 1, 2, 3,
and 4 years to
maturity.
Analysis of the prices of
two bonds at 0, 1, 2, 3, and
4 years to maturity is
missing.
Analysis does not
accurately describe how
the prices trend over time.
Analysis accurately
describes how the prices
trend over time.
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Analysis includes a
reference to the given
business context.
4.
Yield-to-Maturity and Yield-to-Call: Do problem 7-19, Parts a-c, on pages 252–53. (Fundamentals of Financial Management, 13th Edition)
Your Response
Enter your response here
Rubric
Sub-Competency 3: Determine the yield to maturity, the yield to call, and the current yield on a bond.
Learning Objective 3.1:
Calculate the yield to
maturity of a bond.
Learning Objective 3.2:
Calculate the yield to
call of a bond.
Calculation of yield to
maturity of a bond is
missing.
Calculation of yield to call
of a bond is missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
©2015 Walden University
5
Learning Objective 3.3:
Determine the
expected yield of a
bond.
Determination of the
expected yield of a bond is
missing.
Determination of which
yield the investor can
expect is inaccurate and/or
not completely explained.
Determination of which
yield the investor can
expect is accurate and
completely explained.
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Determination includes a
reference to the given
business context.
5.
CAPM and Required Return: Do problems 8-10 and 8-11 on page 291. (Fundamentals of Financial Management, 13th Edition)
Your Response
Enter your response here
Rubric
Sub-Competency 4: Evaluate the Capital Asset Pricing Model (CAPM).
Learning Objective 4.1:
Calculate the required
return rates for two
companies for
comparison purposes.
Learning Objective 4.2:
Calculate the required
return rate for a
company.
©2015 Walden University
Calculations of the
required return rates for
two companies for
comparison purposes are
missing.
Calculation of required
return rate for a company
is missing.
Calculations are inaccurate
and/or incomplete.
Calculations are accurate
and complete.
Calculations are not
documented in detail.
Calculations are
documented in detail.
Calculations do not
provide an appropriate
interpretation of the rates
of return.
Calculation is inaccurate
and/or incomplete.
Response provides an
appropriate interpretation
of the difference between
the rates of return.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Response includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
6
Calculation includes a
reference to the given
business context.
6.
Constant Growth and Non-constant Growth Valuation: Do problems 9-2 and 9-4, Parts a–c, on page 324. (Fundamentals of Financial
Management, 13th Edition)
Your Response
Enter your response here
Rubric
Sub-Competency 5: Determine the value of a share of common stock using various models.
Learning Objective 5.1:
Calculate a stock’s
current value per share
using constant growth
valuation.
Learning Objective 5.2:
Identify the horizon
date for a stock.
Learning Objective 5.3:
Calculate a company’s
horizon or continuing
©2015 Walden University
Calculation of a stock’s
current value per share
using constant growth
valuation is missing.
Identification of the
horizon date for a stock is
missing.
Calculation of a company’s
horizon, or continuing
value, is missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Identification of the
horizon date for a stock is
inaccurate.
Identification of the
horizon date for a stock is
accurate.
Date selection is not
supported by a clear
rationale.
Date selection is supported
by a clear rationale.
Identification of the
horizon date includes a
reference to the given
business context.
Calculation is accurate and Response demonstrates
complete.
the same level of
achievement as “2,” plus
Calculation is inaccurate
and/or incomplete.
7
value.
Learning Objective 5.4:
Calculate a company’s
intrinsic value today.
Calculation is not
documented in detail.
Calculation of a company’s
intrinsic value today is
missing.
Calculation is documented
in detail.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
7.
Weighted Average Cost of Capital: Do problem 10-8 on page 360. (Fundamentals of Financial Management, 13th Edition)
8. Imagine you are the manager of operations for a manufacturing company. Your vice president wants to expand production by building a new
facility, and she would like you to develop a business case for the project. Assume that your company’s weighted average cost of capital is
13%, the after-tax cost of debt is 7%, preferred stock is 10.5%, and common equity is 15%. As you work on the business case, you surmise
that this is a fairly risky project because of a recent slowing in product sales. In fact, when using the 13% weighted average cost of capital,
you discover that the project is estimated to return about 10%, which is quite a bit less than the company’s weighted average cost of capital.
Your vice president suggests that the project could be financed from a mix of retained earnings (50%) and bonds (50%). She reasons that
retained earnings do not cost the company anything because it is cash you already have and the after-tax cost of debt is only 7%. That would
lower your weighted average cost of capital to 3.5% and make your 10% projected return look great.
Is your vice president’s suggestion to use a mix of 50% retained earnings and 50% bonds a good approach for this expansion? Explain why or
why not. (1 paragraph)
9. Capital Budgeting Criteria:
©2015 Walden University
8
•
•
Do problem 11-7, Parts a-d, on page 394. (Fundamentals of Financial Management, 13th Edition)
Which calculation would you recommend in your evaluation—NPV or IRR? Why? (1 paragraph)
Your Response
Enter your response here
Rubric
Sub-Competency 6: Compute the Weighted Average Cost of Capital (WACC) for capital projects, net present value (NPV), internal rate of
return (IRR), and other project evaluation tools.
Learning Objective 6.1:
Calculate a company’s
cost of common equity
capital.
Learning Objective 6.2:
Use a company’s cost
of equity capital to
compute the
company’s WACC.
Learning Objective 6.3:
Provide a
recommendation
based on analysis of a
company’s WACC.
©2015 Walden University
Calculation of a company’s
cost of common equity
capital is missing.
Calculation of WACC using
a company’s cost of equity
capital is missing.
Recommendation based
on analysis of a company’s
WACC is missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Recommendation does not
identify weaknesses in the
proposed expansion plan.
Recommendation
identifies weaknesses in
proposed expansion plan.
Recommendation does not
provide a clear rationale.
Recommendation provides
a clear rationale.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Recommendation includes
a reference to the given
business context.
9
Learning Objective 6.4:
Calculate NPV, IRR,
MIRR, payback, and
discounted payback.
Learning Objective 6.5:
Analyze two capital
projects and make
recommendations
based on the qualities
of independence and
mutual exclusivity.
Learning Objective 6.6:
Explain the conflict
between NPV and IRR
for two capital projects
that have the same
cash flow timing
pattern.
©2015 Walden University
Calculations of NPV, IRR,
MIRR, payback, and
discounted payback are
missing.
Analysis and
recommendations for two
capital projects based on
the qualities of
independence and mutual
exclusivity are missing.
Explanation of the conflict
between NPV and IRR for
two capital projects that
have the same cash flow
timing pattern is missing.
Calculations are inaccurate
and/or incomplete.
Calculations are accurate
and complete.
Calculations are not
documented in detail.
Calculations are
documented in detail.
Analysis and
recommendations
provided are not
appropriate for
independent and mutually
exclusive projects.
Analysis and
recommendations
provided are appropriate
for independent and
mutually exclusive
projects.
Recommendations are not
supported by clear
rationales.
Explanation does not
provide an appropriate
reason for the conflicting
results.
Recommendations are
supported by clear
rationales.
Explanation provides an
appropriate reason for the
conflicting results.
Explanation is not
supported by a clear
rationale.
Explanation is supported
by a clear rationale.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculations include an
alternate data set showing
different results.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Analysis and
recommendation are
supported by an additional
real world example.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Explanation provides an
alternate data set in which
the results are not
conflicting for contrast.
10
References
©2015 Walden University
11
Purchase answer to see full
attachment
In this Short Answer Assessment, using the practice problems in the textbook
(Fundamentals of Financial Management, 2013) you will answer a series of
short answer items to demonstrate your ability to use multiple techniques to
evaluate long-term capital position and needs.
Access the following to complete this Assessment:
•
•
Text: Fundamentals of Financial Management, 13th Edition (2013)
SF004 Short Answer Submission Form (with Rubric)
Instructions
Before submitting your Assessment, carefully review the rubric. This is the
same rubric the assessor will use to evaluate your submission and it provides
detailed criteria describing how to achieve or master the Competency. Many
students find that understanding the requirements of the Assessment and the
rubric criteria help them direct their focus and use their time most productively.
To complete this Assessment:
•
•
Download the Academic Writing Expectations Checklist to use as a guide
when completing your Assessment. Responses that do not meet the
expectations of scholarly writing will be returned without scoring. Properly
formatted APA citations and references must be provided where
appropriate.
Download the SF004 Short Answer Submission Form, which includes the
Rubric for this Assessment. Complete the form adhering to the criteria
presented in the Rubric.
This Assessment requires submission of one (1) document, a completed
Short Answer Submission Form. Save this file
as SF004_firstinitial_lastname (for example, SF004_J_Smith). When you
are ready to upload your completed Assessment, use the Assessment tab on
the top navigation menu.
SF004: Sources and Uses of Short-Term Capital
Short Answer Submission Form
Your Name: First and last
Your E-mail Address: Your email here
Instructions
This Competency includes a Short-Answer Response Assessment. Write your response to each prompt below in the space provided. The Rubric,
which will be used by the Competency Assessor to evaluate your responses, is beneath the prompts. Carefully review the Rubric rows associated
with each prompt to provide a complete response.
When writing your response, begin typing where it reads “Enter Your Response Here.” Write as much as needed to satisfy the requirements of
the prompt (as defined in the Rubric). Be sure to support your responses with connections to professional sources.
Your Assessment responses require references (in APA style) to support your thinking. You will list your references at the end of this template
where “References” are noted. If you need additional information regarding how to correctly cite, and/or reference sources, please visit the
Walden Writing Center at http://academicguides.waldenu.edu/writingcenter/apa/citations
To learn more about effective paraphrasing strategies, visit the Walden Writing Center at
http://academicguides.waldenu.edu/writingcenter/evidence/paraphrase/effective
©2015 Walden University
1
Review the following example item and response for a sample that meets expectations.
Sample Prompt:
Choose a definition of organizational culture, and explain whether you agree or disagree with the definition. Use examples from your
own professional experience to support your response.
Response:
Whitehurst (2016) explained “organizational culture is defined by how people in an organization interact with each other” (para. 2).
While I agree that this is one aspect of organizational culture, the definition does not capture the complex factors that contribute to
organizational culture. When I started my first job after finishing my undergraduate degree in business, I worked for an organization
whose main headquarters were in Dubai. When I traveled to Dubai for the first time, I realized that the culture of the Dubai office was
largely influenced by the society’s culture in Dubai. I found that the organization lacked one cohesive culture and that, depending on
regional locations, each office had its own culture. International organizations often face many challenges in maintaining a cohesive
organizational culture (Watkins, 2013). I found this observation to be true in my experience. For example, the Dubai office seemed to
endow their employees with more allowance for self-direction when compared with our domestic offices. Although people’s
interactions with one another contributed to the organization’s culture, there were other factors like location, management style, and
societal norms that impacted a business culture as well.
References
Watkins, M. D. (2013, May 15). What is organizational culture? And why should we care. Harvard Business Review. Retrieved from
https://hbr.org/2013/05/what-is-organizational-culture
Whitehurst, J. (2016, October 13). Leaders can shape company culture through their behaviors. Harvard Business Review. Retrieved from
https://hbr.org/2016/10/leaders-can-shape-company-culture-through-their-behaviors
Note: References are included at the end of a Short-Answer Assessment but are included here as an example of an accurate APA
reference list.
©2015 Walden University
2
1.
Time Value of Money: Review the examples of Time Value of Money (TVM) problems in Chapter 5 of the text. (Fundamentals of Financial
Management, 13th Edition)
•
•
Using your own industry as the context, create and solve four of your own original TVM problems: (1) lump-sum present value, (2)
lump-sum future value, (3) present value of an annuity, and (4) future value of an annuity. Your scenarios may be fictitious, but they
should make sense in the real-life context of your industry.
Write a 1-paragraph summary for each of your scenarios that explains the “real-life” context of these four problems as well your
interpretations of each of the calculations. (4 paragraphs total)
Your Response
Enter your response here
Rubric
0
Not Present
1
Needs Improvement
2
Meets Expectations
3
Exceeds Expectations
Sub-Competency 1: Compute various time value of money (TVM) problems (future value, present value, annuities).
Learning Objective 1.1:
Create and solve TVM
problems.
Learning Objective 1.2:
Solve TVM problems
based on experience in
an industry.
TVM problems and
solutions are missing.
TVM solutions to problems
based on experience in an
industry are missing.
Response does not include
four TVM problems: (1)
lump-sum present value,
(2) lump-sum future value,
(3) present value of an
annuity, and (4) future
value of an annuity.
Response includes four
TVM problems: (1) lumpsum present value, (2)
lump-sum future value, (3)
present value of an
annuity, and (4) future
value of an annuity.
TVM problems do not use
plausible numbers/figures
for industry application.
TVM solutions are
inaccurate.
TVM problems use
plausible numbers/figures
for industry application.
TVM solutions are
accurate.
TVM solutions are not
documented in detail.
TVM solutions are
documented in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Response relates problems
to real-world examples
within a specific industry.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
TVM solutions are clearly
©2015 Walden University
3
Learning Objective 1.3:
Explain how the TVM
problems and solutions
reflect the real-life
business context of a
specific industry with
which the student is
familiar.
2.
0
Not Present
1
Needs Improvement
Explanation of how TVM
problems and solutions
reflect the real-life context
of a specific industry with
which the student is
familiar is missing.
Explanation does not
clearly connect the data
used in the TVM problems
with a real-life industry
context.
Explanation is not framed
in terms of industry
context and/or
parameters.
2
Meets Expectations
Explanation clearly
connects the data used in
the TVM problems with a
real-life industry context.
Explanation of solutions is
framed in terms of
decision making that could
be considered.
3
Exceeds Expectations
related to real-world
examples within a specific
industry.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Response includes one or
more additional problems
and solutions.
Bond Valuation: Do problem 7-6, Part a, on page 251. (Fundamentals of Financial Management, 13th Edition)
3. Bond Pricing Interpretation: Explain what you see from the pricing calculations. How do the two bonds differ? (1 paragraph)
Your Response
Enter your response here
Rubric
Sub-Competency 2: Compute the value of a bond with various rates and terms.
Learning Objective 2.1:
Calculates the prices of
two bonds at 0, 1, 2, 3,
and 4 years to
maturity.
Calculation of the prices of
two bonds at 0, 1, 2, 3, and
4 years to maturity is
missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
©2015 Walden University
4
Learning Objective 2.2:
Analyze the prices for
two bonds at 0, 1, 2, 3,
and 4 years to
maturity.
Analysis of the prices of
two bonds at 0, 1, 2, 3, and
4 years to maturity is
missing.
Analysis does not
accurately describe how
the prices trend over time.
Analysis accurately
describes how the prices
trend over time.
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Analysis includes a
reference to the given
business context.
4.
Yield-to-Maturity and Yield-to-Call: Do problem 7-19, Parts a-c, on pages 252–53. (Fundamentals of Financial Management, 13th Edition)
Your Response
Enter your response here
Rubric
Sub-Competency 3: Determine the yield to maturity, the yield to call, and the current yield on a bond.
Learning Objective 3.1:
Calculate the yield to
maturity of a bond.
Learning Objective 3.2:
Calculate the yield to
call of a bond.
Calculation of yield to
maturity of a bond is
missing.
Calculation of yield to call
of a bond is missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
©2015 Walden University
5
Learning Objective 3.3:
Determine the
expected yield of a
bond.
Determination of the
expected yield of a bond is
missing.
Determination of which
yield the investor can
expect is inaccurate and/or
not completely explained.
Determination of which
yield the investor can
expect is accurate and
completely explained.
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Determination includes a
reference to the given
business context.
5.
CAPM and Required Return: Do problems 8-10 and 8-11 on page 291. (Fundamentals of Financial Management, 13th Edition)
Your Response
Enter your response here
Rubric
Sub-Competency 4: Evaluate the Capital Asset Pricing Model (CAPM).
Learning Objective 4.1:
Calculate the required
return rates for two
companies for
comparison purposes.
Learning Objective 4.2:
Calculate the required
return rate for a
company.
©2015 Walden University
Calculations of the
required return rates for
two companies for
comparison purposes are
missing.
Calculation of required
return rate for a company
is missing.
Calculations are inaccurate
and/or incomplete.
Calculations are accurate
and complete.
Calculations are not
documented in detail.
Calculations are
documented in detail.
Calculations do not
provide an appropriate
interpretation of the rates
of return.
Calculation is inaccurate
and/or incomplete.
Response provides an
appropriate interpretation
of the difference between
the rates of return.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Response includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
6
Calculation includes a
reference to the given
business context.
6.
Constant Growth and Non-constant Growth Valuation: Do problems 9-2 and 9-4, Parts a–c, on page 324. (Fundamentals of Financial
Management, 13th Edition)
Your Response
Enter your response here
Rubric
Sub-Competency 5: Determine the value of a share of common stock using various models.
Learning Objective 5.1:
Calculate a stock’s
current value per share
using constant growth
valuation.
Learning Objective 5.2:
Identify the horizon
date for a stock.
Learning Objective 5.3:
Calculate a company’s
horizon or continuing
©2015 Walden University
Calculation of a stock’s
current value per share
using constant growth
valuation is missing.
Identification of the
horizon date for a stock is
missing.
Calculation of a company’s
horizon, or continuing
value, is missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Identification of the
horizon date for a stock is
inaccurate.
Identification of the
horizon date for a stock is
accurate.
Date selection is not
supported by a clear
rationale.
Date selection is supported
by a clear rationale.
Identification of the
horizon date includes a
reference to the given
business context.
Calculation is accurate and Response demonstrates
complete.
the same level of
achievement as “2,” plus
Calculation is inaccurate
and/or incomplete.
7
value.
Learning Objective 5.4:
Calculate a company’s
intrinsic value today.
Calculation is not
documented in detail.
Calculation of a company’s
intrinsic value today is
missing.
Calculation is documented
in detail.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
7.
Weighted Average Cost of Capital: Do problem 10-8 on page 360. (Fundamentals of Financial Management, 13th Edition)
8. Imagine you are the manager of operations for a manufacturing company. Your vice president wants to expand production by building a new
facility, and she would like you to develop a business case for the project. Assume that your company’s weighted average cost of capital is
13%, the after-tax cost of debt is 7%, preferred stock is 10.5%, and common equity is 15%. As you work on the business case, you surmise
that this is a fairly risky project because of a recent slowing in product sales. In fact, when using the 13% weighted average cost of capital,
you discover that the project is estimated to return about 10%, which is quite a bit less than the company’s weighted average cost of capital.
Your vice president suggests that the project could be financed from a mix of retained earnings (50%) and bonds (50%). She reasons that
retained earnings do not cost the company anything because it is cash you already have and the after-tax cost of debt is only 7%. That would
lower your weighted average cost of capital to 3.5% and make your 10% projected return look great.
Is your vice president’s suggestion to use a mix of 50% retained earnings and 50% bonds a good approach for this expansion? Explain why or
why not. (1 paragraph)
9. Capital Budgeting Criteria:
©2015 Walden University
8
•
•
Do problem 11-7, Parts a-d, on page 394. (Fundamentals of Financial Management, 13th Edition)
Which calculation would you recommend in your evaluation—NPV or IRR? Why? (1 paragraph)
Your Response
Enter your response here
Rubric
Sub-Competency 6: Compute the Weighted Average Cost of Capital (WACC) for capital projects, net present value (NPV), internal rate of
return (IRR), and other project evaluation tools.
Learning Objective 6.1:
Calculate a company’s
cost of common equity
capital.
Learning Objective 6.2:
Use a company’s cost
of equity capital to
compute the
company’s WACC.
Learning Objective 6.3:
Provide a
recommendation
based on analysis of a
company’s WACC.
©2015 Walden University
Calculation of a company’s
cost of common equity
capital is missing.
Calculation of WACC using
a company’s cost of equity
capital is missing.
Recommendation based
on analysis of a company’s
WACC is missing.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Calculation is inaccurate
and/or incomplete.
Calculation is accurate and
complete.
Calculation is not
documented in detail.
Calculation is documented
in detail.
Recommendation does not
identify weaknesses in the
proposed expansion plan.
Recommendation
identifies weaknesses in
proposed expansion plan.
Recommendation does not
provide a clear rationale.
Recommendation provides
a clear rationale.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculation includes a
reference to the given
business context.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Recommendation includes
a reference to the given
business context.
9
Learning Objective 6.4:
Calculate NPV, IRR,
MIRR, payback, and
discounted payback.
Learning Objective 6.5:
Analyze two capital
projects and make
recommendations
based on the qualities
of independence and
mutual exclusivity.
Learning Objective 6.6:
Explain the conflict
between NPV and IRR
for two capital projects
that have the same
cash flow timing
pattern.
©2015 Walden University
Calculations of NPV, IRR,
MIRR, payback, and
discounted payback are
missing.
Analysis and
recommendations for two
capital projects based on
the qualities of
independence and mutual
exclusivity are missing.
Explanation of the conflict
between NPV and IRR for
two capital projects that
have the same cash flow
timing pattern is missing.
Calculations are inaccurate
and/or incomplete.
Calculations are accurate
and complete.
Calculations are not
documented in detail.
Calculations are
documented in detail.
Analysis and
recommendations
provided are not
appropriate for
independent and mutually
exclusive projects.
Analysis and
recommendations
provided are appropriate
for independent and
mutually exclusive
projects.
Recommendations are not
supported by clear
rationales.
Explanation does not
provide an appropriate
reason for the conflicting
results.
Recommendations are
supported by clear
rationales.
Explanation provides an
appropriate reason for the
conflicting results.
Explanation is not
supported by a clear
rationale.
Explanation is supported
by a clear rationale.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Calculations include an
alternate data set showing
different results.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Analysis and
recommendation are
supported by an additional
real world example.
Response demonstrates
the same level of
achievement as “2,” plus
the following:
Explanation provides an
alternate data set in which
the results are not
conflicting for contrast.
10
References
©2015 Walden University
11
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