A) GDP at market prices
Gross domestic product at market prices is the sum of the gross values added of all resident
producers at market prices, plus taxes less subsidies on imports.
gov. purchases of goods and services
Debt and Taxes
Net Income = EBIT Interest Taxes = ( 325 125 ) (1 0.40 ) = $120 million.
Net income + Interest = 120 + 125 = $245 million
Net income = EBIT Taxes = 325 (1 0.40 ) = $195 million. This is 245 195 = $50 million lower
than part (
CHOOSING BRAND ELEMENTS TO BUILD
Criteria for Choosing Brand Elements
Marketers offensive strategy
and build brand equity
Defensive role for lev
Learn to use TVM in investment analysis
Develop project evaluation models
The process of evaluating
long-term investment options.
Firms must decide which projects to
Capital budgeting techniques ca
The Cost of Capital
the cost of debt
Compute the cost of
Compute the cost of equity
Compute the weighted
average cost of capital
it will let you make better
project selection decisions.
a project is identified
1. Explain how cigarettes could be called "money" in prisoner-of-war camps of World War II.
The cigarettes performed the three functions of money. They served as the
exchange because individuals did exchange items for cigarettes. They
Instructor: George Simongulashvili
Describe the concepts underlying the cost
Compute the price of a consol and a
Compute the price of a zero-coupon bond.
Compute the price of a fix
FIN 304 Corporate Finance
DEBT AND TAXES
The Interest Tax Deduction
Valuing the Interest Tax Shield
Recapitalizing to Capture the Tax Shield
Optimal Capital Structure with Taxes
Inventory refers to stocks of goods and
materials that are maintained for many
purposes, the most common being to
satisfy normal demand patterns.
What is Procurement ?
Procurement refers to the raw materials,
component parts, and supplies bought from
outside organizations to support a
It is closely related to logistics since acquired
there are constant returns to scale
Y 0=F (K , L)= AK 0.8 L0.8
Y 1=F ( z K , z L)= A( z K )0.8
z z A K L
z Y 0 > zY 0 There
Fixed Exchange Rates and the Adjustment of
the Real Exchange Rate
In the medium run, the economy reaches the
same real exchange rate and the same level of
(whether it operates under fixed exchange rates or
under flexible excha
LEVERAGING SECONDARY BRAND
KNOWLEDGE TO BUILD BRAND
Figure 2-9 Building Customer-Based Brand Equity
BRAND BUILDING TOOLS AND OBJECTIVES
CONSUMER KNOWLEDGE EFFECTS
Choosing Brand Elements
PROGRAMS TO BUILD
How do marketing activities in generaland
product, pricing, and distribution strategies in
particularbuild brand equity?
How can marketers integrate these activities to
CUSTOMER-BASED BRAND EQUITY
Building a powerful brand
Do you know what makes a brand strong?
If you had to make yours stronger, would you know
how to do it?
Many factors influence the strength of a particular
product or brand. If you unde
DESIGNING AND IMPLEMENTING
Branding strategy is critical because it is the
means by which the firm can help consumers
understand its products and services and
organize them in their minds.
BRANDS & BRAND MANAGEMENT
What is a brand?
For the American Marketing Association (AMA), a brand is a
name, term, sign, symbol, or design, or a combination of
them, intended to identify the goods and services of one
seller or group of sell
DEVELOPING A BRAND EQUITY MEASUREMENT AND
The New Accountability
Virtually every marketing dollar spent today
must be justified as both effective and
efficient in terms of return of marketing
BRAND POSITIONING & VALUES
Is at the heart of the marketing strategy
. . . the act of designing the companys offer and
image so that it occupies a distinct and valued place
in the target customers minds.
FIN 304 Corporate Finance
IN A PERFECT MARKET
Equity versus Debt Financing
Modigliani-Miller I: Leverage, Arbitrage, and Firm
Modigliani-Miller II: Leverage, Risk, and the Cost