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Georges Team
Management of Working Capital Case Study: Georges Trains
. View the following video:
http://searchcenter.intelecomonline.net/playClipDirect.as
px?id=4870EEC7664070BB9D6744FDA7325EE44F45E0E47862343D60F
AA8E3325D1A83C46D5C6FAB3D01A758FA30144214BB3D
It appears that George is running a profitable business. George is a
ware you are in an MBA Managerial Finance class and comes to yo
u for advice on his working capital practices. More specifically Geor
ge asks:
apital Asset Pricing Model (CAPM). Using the course text and an art
icle from ProQuest as references, address the following:
Explain how the CAPM assists in measuring both risk and return.
Explain how the CAPM assists in calculating the weighted average c
osts of capital (WACC) and its components.
Illustrate why some managers have difficulty applying the Capital A
sset Pricing Model (CAPM) in financial decision making.
y
Capital Budgeting and Dividend Policy. We examined two very i
mportant topics in finance this week; Capital Budgeting and Divide
nd Policy.
Critically reflect on the importance of selecting the right projects in
which to invest capital. Do we always select those projects that hav
e the highest return on investment? What other factors play into ca
pital budgeting decisions?
We also looked at dividend policy. What incentive is there for a co
mpany to pay dividends? What signals does dividend policy provid
e to investors?