The background readings of this Module provide plenty of information regarding both the issue of the capital structure decision and the concept of the weighted average cost of capital.
Consider three companies: Ford, Disney, and Electronic Arts. Reflect on the nature of the business of these three companies. You are recommended to also get to the web site of one company in each of these categories. You might also check what the beta of each of these companies is.
Based on the readings of the Module, and upon reviewing the nature of the operations of the companies including the nature of their customers and products, what would you recommend should the capital structure (total liabilities or debt and equity proportions) be for each of the three companies? Note that you are not asked to provide specific numbers, just ‘low debt ratio’, ‘medium debt ratio’ or ‘high debt ratio’. (Do not quote the actual company’s capital structure or their debt-to-equity ratios as per their balance sheet.)
Write a five page paper explaining your recommendations for each of these three companies. Consider the nature of their business, the riskiness of the company, and the advantages and disadvantages of debt over equity financing in your answers.
Case Assignment Expectations
In the grading of your assignment, you will be assessed on the following items:
1. The use of multiple references beyond just the links mentioned above. Those links are just to get you started, but your ability to do your own research beyond these two articles will be assessed.
2. Your ability to focus the paper from beginning to end on the precise assignment questions. Remember that the assignment question is not to provide the firm’s actual capital structure, but rather your recommendation as to whether or not the firm should have a high, medium, or low debt ratio.
3. Your paper should be at least five pages in lengths.
4. Your paper should include proper referencing, both with a bibliography and references within your text. See the two links on referencing in the syllabus page for more detail about referencing. These references should direct support your answers to the four main assignment questions.
Place an order of a custom essay for this assignment with us now. You are guaranteed; a custom premium paper being delivered within its deadline, personalized customer support and communication with your writer through out the order preparation period.
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more