WEEK 3 DISCUSSION RESPONSES NAME: INSTITUTION: DATE: Discussion 1 responses Emily Drummond, A valid contract should be acceptable to both parties and involves the establishment of an agreement. For a contract to be valid, it should be signed, and all terms of the contract described. In real estate businesses, a valid contract should be developed to avoid conflicts and also illegal deals. An option is a form of contract where the property owner agrees to put on hold to current see after being paid a consideration fee (Hobkirk, 2017). This is helpful as it allows an individual to seek enough money or investigate the suitability of the property to their use. As you stated, a valid contract should be supported by an offer, consideration, and acceptance. These are some of the components of a valid contract, and the contract must be signed by both contracting parties. The buyer should also pay consideration (money or services) to the owner for them to agree to an option contract. References Hobkirk, A. (2017). ESSENTIAL ELEMENTS OF A VALID CONTRACT. Company Administration Handbook, 205.…

Concepts of managerial finance The chapters included here deal with the essential concepts of managerial finance and focusses on crucial concepts and definitions in the field. Some of the ideas discussed here are risk-return, corporate stock valuations, and financial applications. The chapters have also covered options in the area of corporate finance. Chapter 6 deals with investment return concepts. The subtopics include the Basic return and risk concepts such as Stand-alone risk, portfolio (market) risk, and return CAPM/SML, market equilibrium, and market efficiency. Chapter 7 covers the topics included in corporate and stock valuation. The topics further included in this are features and valuing of common stock, preferred stock, classified stock, tracking stock. The final chapter, chapter 8, mainly deals with the concept of financial options and its applications in corporate finance systems. The topics included in the chapter are financial options terminology, option price relationships, Black-Scholes option pricing model, put-call parity The sections discussed here focus on the concepts of managerial finance and discuss essential ideas related to it, along with a few fundamental definitions. Chapter 6 covers risk…

Corporate Finance: United Automobiles Company My firm, United Automobiles, is based in the United States. It will be exporting automobiles, especially passenger cars, to different countries across the globe. Its primary target market is Canada due to its high population that relies on the private transport system. For the interest of the business, it is essential to analyze various factors that can influence the balance of trade between the United States and Canada. Besides, the same factors may influence the demand for automobiles in Canada and consequently dictating the company’s success. Factors that affect the balance of trade between the United States and Canada Trade policies/ Regulations   The success of UA Company will significantly be influenced by trade policies between Canada and the United States.  Trade barriers limit the number of passenger cars exported to Canada. Policies that limit imports from the United States to Canada reduces the total amount of passenger cars exported. Further, subsidies on exports reduce the relative price of cars, therefore, making imported cars in Canada less attractive. Besides, in case Canada applies import quotas…

ADVANCED CORPORATE FINANCE QUESTIONS 1 Accommodate plc is a hospitality company that owns a chain of hotels in the UK. The company is considering the acquisition of several fitness centers to expand its operations. The Finance Director has been asked to evaluate the project. The investment would cost £20 million, which would be payable immediately. The investment is expected to generate pre-tax earnings of £1.2 million for the first year, £2.3 million for the second year, and £2million for each year after that. The investment will be financed by 30% equity and 70% debt, which is in line with Accommodates existing capital structure. Due to a government initiative, some of the debt will be raised by a subsidized loan, however, the details are yet to be determined. Accommodates current weighted average cost of capital (WACC) is 9%, and their pre-tax cost of debt is equal to the risk-free rate of 2%. The expected market return is currently 6%. The Finance Director of Accommodate plc has obtained the equity and debt betas and the gearing ratio of a proxy company, for…

Islamic Finance and Banking In recent years, there has been a significant increase in the number of Islamic financial institutions. This in itself has led to an increase in the number of inventions in the Islamic banking market. The Market has however not fully developed. According to a report by the global Islamic finance, there were only about 505 registered Islamic banks in 2017. This paper seeks to come up with new a new Sharia compliant financial instrument that can be used in Islamic finance. Due to advancement in technology, a virtual bank is one of the less popular and unexplored options in Islamic Finance and banking. There is a huge potential in Islamic world as most people prefer using debit or even credit cards. This system will use the Murabanah and mudarabah type of structure to provide cashless banking solutions. This will be made possible by introducing and issuing digital cards to our available customers. Developing a mobile application so that our customers are able to access their details anywhere despite their locations. They will also be able to…

A brand portal A brand portal is a storage center for digital assets. The portals allow users to share crucial digital content externally and internally. However, they offer secure sharing of valuable company assets and guidelines, for instance, brochures and images. When connected to a digital asset management system, brand portals frequently updates as new asset versions upload. With this in mind, it is no longer sufficient to share assets via traditional distribution strategies such as the Dropbox or We Transfer. There is a need for a way out that feels and looks like a distinctive brand. Besides, brand portals are very accommodating at any moment of a company’s progression, from its foundation to its expansion. Even though a brand portal is a cherished asset to many businesses, it is not essential for all companies. Companies with brand portals share faster with externals. As a company grows, it adds value digital content to a company image library. This content is worthwhile to externals wishing to use it for a story, reference, or research. The brand portal refurbishes the conveying of these…

U.S. government The United States of America has made positive strides constitutionally to the formation of the new structure of government. The objective of this paper is to analyze the first two national governments and understanding their structures as well as their similarities and differences. The articles of confederation (AOC) were authored and fully ratified in 1781. They acted as an operational tool to the U.S. government until the formation of the U.S. constitution that replaced the articles of confederation. Under the articles of confederation, the government consisted of the congress that was a singular legislative body. The government may have taken this structure to reduce the powers that had previously fueled the American revolutionary war and the fighting that had existed between Great Britain and colonies. Much power lay under the state legislatures under according to the articles of confederation because all states were entitled to retain their sovereignty, freedom, and independence. However, the central government held some powers too that were granted by the articles of confederation. It was the only one that could declare war and conduct…

India Infoline Finance Limited (IIFL) REVIEW IIFL or India Infoline Finance Limited is a full-service stockbroker formerly known as IIFL Holdings Limited and the headquarters located in the city Mumbai, India. India Infoline Limited is one of the premier financial providers of India. India Infoline has started its services in the year 1995, and Mr Nirmal Jain and Mr R. Venkatraman are the founders of IIFL. Moreover, it is one of the largest and oldest financial firms with multiple verticals, and the stock broker is one of its financial services. IIFL managed to spread its trading network in more than 4000+ locations if more than 900+ cities in India. Also, the full-service broker holds its services in multiple foreign towns like Hong Kong, Dubai, New York, Singapore, Geneva, Mauritius and London. The key offering of the broker is the research services, Equity and commodity trading. IIFL is a listed broker on BSE (532636) and NSE (INDIA-INFO) for Security Trading. From recent reports it was found that the average daily turnover of the broker is around Rs. 4355 Crores in Equity…

Managerial Finance A company’s stock can create hype because of how sensitive the value can be to various factors.  In order to make the right choice when deciding to either “buy” or “sell”, there are certain factors that an observant investor should be aware of when evaluating a company’s stock. Some of the crucial factors include: Supply and Demand, Economic Situation, Company Performances, Market Rumors, and even Political Instability. The investor is required to familiarize with a company’s supply and demand to determine if the product is in high demand.  If so, the stock prices will increase until it reaches a mutual settlement.  Following is the “economic situation” factor, where the company’s stock market performance is known as the “leading indicator” of where the market expectations will be in a few months. The investor will the consider “Company Performance”, where he will focus on the firm’s “business fundamental” because this would influence the stock price in the long run.  New Strait Times states about this factor, “As an investor, your concern should be on the direction of the firm businesswise,…

Growing companies Growing companies face a range of challenges. As they grow, different opportunities and problems require different solutions. It is the responsibility of a company to find ways to keep up with the demand. In this case, McCormick& Company has to make a major decision on whether to invest in another factory to keep up with the demand as the company is strandedon whether it will yield good returns. One of the best determinants of whether McCormick & Company should invest in building another factory in Largo, Maryland,depends on their financial strength, which is demonstrated by their financial books. The companyis doing well financially according to their financial information, which is a big factor that can facilitate their decision to investin another new factory in Maryland. Besides, the fact that the company can borrow 70% of $ 4.424m ($3,096,800) and pay 30% of this money as cash down payment to finance the purchase of the land reinforces the decision of the company to invest in building a new factory. When doing an investment, risk and returns are some of the…