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MLA
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Accounting, Finance, SPSS
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English (U.S.)
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Accounting, Finance, SPSS Coursework. Answer the following questions.

Coursework Instructions:

In an influential paper titled “How Do CFOs Make Capital Budgeting and Capital Structure Decisions?”  , two finance professors from Duke have surveyed company CFOs on how they make capital budgeting and capital structure decisions. 
First, read the paper, and then answer the following questions. You can use additional sources to answer the questions provided you cite them properly using the MLA formatting standard.
1. As we already know, managers rely primarily on IRR and NPV when deciding on a new project. However, in Figure 1, the “hurdle rate” appears to be the third most common decision rule. Can you explain what the hurdle rate is in one paragraph?
2. Similarly, CFOs rely on “Real Options” in 27% of the decisions. Again, summarize this approach in a paragraph.
3. The survey Figure 2 shows that a lot of CFOs value financial flexibility when issuing debt. What do they mean by financial flexibility? How is financial flexibility important for the company?
4. The number one reason why CFOs issue foreign debt was to “provide a natural hedge to foreign operations” (see Figure 3). Can you explain how issuing foreign debt helps to hedge financial operations? 
5. In Figure 4, CFOs respond that they have a very strict or somewhat strict target range for their Debt-Equity ratios. Can you explain why firms will want to have a target debt-equity ratio and how this ratio will vary according to the company industry? 
6. In Figure 5, the most common factor that CFOs care about when issuing equity is “Earnings per Share Dilution”. What do they mean? 
7. Would issuing new equity inevitably lead to lower share price? Why or why not?
In an influential paper titled “How Do CFOs Make Capital Budgeting and Capital Structure Decisions?” , two finance professors from Duke have surveyed company CFOs on how they make capital budgeting and capital structure decisions.
First, read the paper, and then answer the following questions. You can use additional sources to answer the questions provided you cite them properly using the MLA formatting standard

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Accounting
Question1
In capital budgeting decisions, there are different techniques that managers can use. For instance, a manager may use the hurdle rate, which is the minimum rate of return in an investment that is required by an investor. The hurdle rate enables managers to determine whether it is worth to pursue specific projects. Additionally, the hurdle rate enables managers to evaluate the compensation for the level of risk that is available on projects. Investments with high risk have a relatively high hurdle rate than those with less risk. The level of risk may be determined by examining the cost of capital and the expected returns.
Question 2
Some companies use Real Options (RO) evaluation techniques when making investment opportunities or business projects. The technique is called real options because it involved investments involving tangible assets such as land and buildings. RO is used in about one-fourth of the companies, and this is surprising because the technique is fairly new, and its quantitative applications are relatively complicated (Graham, p.12). Additionally, RO includes the choices that management gives itself to expand change investment decisions based on the changing economic condition.
Question 3
The chief financial officers (CFOs) value financial flexibility when issuing debt. Financial flexibility refers to the ability of a company or organization to react and adapt to the changing financial conditions. Financial flexibility is essential for companies because it helps in preserving unused debt capacity because it helps in financing intended future expansions and make acquisitions. Further, companies also maintain their unused debt after expanding, and the flexibility realized is used in maintaining a target credit rating.
Question 4
Often, companies are likely to issue short-term debt when it is necessary to time market interest ...
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