Other Financial Management Topics

Financial Management

What is Cost of Equity?

What is Cost of Equity? The cost of equity is the return ( rate of return) a company pays to its equity

What is Capital Rationing? Capital rationing is restricted on the amount of new investments or projects undertaken by a company.There

What is Value at risk Value at Risk (VaR) is a measure of the risk of investments. It estimates how

Option Pricing Theory The most used models are the Black-Scholes model and the binomial model. Both theories on options pricing

The break-even point (BEP) The break-even point (BEP) is the point at which total cost and total revenue are equal.

Present Value with Supernormal Growth Rate Time Line Which Ct+1 = Ct(1+g)1 Ct+2 = Ct(1+g)2 Ct+3 = Ct(1+g)2

Present Value with the Two-Stage Growth Rate This model assumes the future cash flows will grow at different rates for

Present Value with Constant Perpetual Growth Rate Present value with constant perpetual growth rate is often applied to find present

Present Value with Constant Growth Rate Present value with constant growth rate is often applied to find present value or

Present Value of Perpetuity Due The word perpetuity is an annuity in which the cash flows continue forever. The cash

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