Problem set 1
Question.1(b)
i. The annual sales growth for the three years are respectively 10%, 18%and17%. The sales do
grow by 80rom the year 2011 to 2012,but in the year of 2013, the sales decrease by 1%. Because
the CD manufacture industry overall is
PROBLEM SET 2
1.a
1.b
The Working Capital as a sales percentage is at a high level
and has increased dramatically during the 4year interval
DSO is around 4 months but goes up to more than 4 months.
DSI is around 17 months and increased steadily and fast,
MSOR 410
Financial Management for Supply Chain
Problem Set 4 Profitability, Returns and Growth
1. Decomposing Return on Equity Using DuPont Ratios
Using your solution from Problem Set 3 problem 1 regarding Astral
Records, please answer the following quest
MSOR 410
Problem Set 5
1. Can be either $5,000 = PV for 5 yrs at r% x $20,000 or
$5,000 x FV for 5 yrs at r% = $20,000
I'll solve using IRR:
0
1
2
3
(5,000)
#
IRR =
32.0%
4

2. This is the PV of four payments of $2,500 today at 10%
0
1
2
3
2,500
2,500
2,
MSOR 410
Problem Set 7
1. Company valuation
a. Enterprise value
b. Value of shares
c. Impact EV
75
938
125
1,563
1,250
$ 40.00
Share Price
25% $ 27.50
25% $ 52.50
31%
31%
These percentages vary because debt amplifies the impact
on equity, the residual v
Problem Set 9
Solution
1. Public equity valuation
Price target is $72 (cover on upper right)
Current price was $61.54 (so 17% upside)
Reasons were listed as:
* Industry leader in category of architectural coatings
* Volume recovery led by rebound in housi
MSOR 410
Problem Set 8
1. Risk return on securities
a. Risk profile from lowest is tbills to Government bonds to Corporate bonds to Stocks
From 19262007 the average rates reflect this; over shorter periods of time they are a little
more inconsistent
b.