公司理财课件英文版(ppt 25)

CapitalInvestmentDecisions,2.1NetPresentValue2.2ProjectValuationinaRisklessWorldFishersPrinciple2.3PresentValueandCompounding2.4PresentValuewithSpecialCashFlows(RWJCh3,4),InvestmentDecision,Example1:Supposeaninvestmentthatpromisestopay$10,000inoneyearisofferedforsalefor$9,500.Yourinterestrateis5%.Shouldyoubuy?,Ifyouweretobepromised$10,000dueinoneyearwheninterestratesareat5-percent,yourinvestmentbeworth$9,523.81intodaysdollars.,2.1NetPresentValue:FVandPV,Theamountthataborrowerwouldneedtosetasidetodaytotoabletomeetthepromisedpaymentof$10,000inoneyeariscallthePresentValue(PV)of$10,000.,Notethat$10,000=$9,523.81(1.05).,Ifyouweretoinvest$10,000at5-percentinterestforoneyear,yourinvestmentwouldgrowto$10,500:$10,500=$10,000(1.05).ThetotalamountdueattheendoftheinvestmentiscalltheFutureValue(FV).,NetPresentValue,TheNetPresentValue(NPV)ofaninvestmentisthepresentvalueoftheexpectedcashflows,lessthecostoftheinvestment.,:SoyoushouldInvest.,BacktoExample1:,NetPresentValueastheInvestmentCriterion,Intheone-periodcase,theformulaforNPVcanbewrittenas:,IfwehadnotundertakenthepositiveNPVprojectconsideredonthelastslide,andinsteadinvestedour$9,500elsewhereat5-percent,ourFVwouldbelessthanthe$10,000thatinvestmentpromisedandwewouldbeunambiguouslyworseoffinFVtermsaswell:$9,500(1.05)=$9,975$10,000.,whereiscashflowatdate1,2.2ProjectEvaluationinaRisklessWorld,WhydoweuseNPVastheinvestmentcriterion?,AssumePerfectCapitalMarketandTwoPeriod,(I)Saving(Financing)Decision,UsePVtoCheckFeasibilityofConsumptionplan,Example2:IstheconsumptionplanC00.9mandC11.325mfeasible?UsethePVformulatoevaluateit.,Ifr10%,0.92.105PV(C)12.091PV(Y):notfeasibleIfr20%,0.92.004PV(C)12.000PV(Y):notfeasibleIfr30%,0.91.919PV(C)11.923PV(Y):feasible!,()InvestmentOpportunities,CorporateInvestmentDecisionMaking,Consumptionatt+1,PositiveNPVprojectsshifttheshareholdersopportunitysetout,whichisunambiguouslygood.,AllshareholdersagreeontheirpreferenceforpositiveNPVprojects,whethertheyareborrowersorlenders.,()InvestmentOpportunitieswithFinancialMarkets,Financialmarketspresentsaving/borrowingopportunities,asrepresentedbythedottedstraightline.Supposethecompany(farm)choosesD,itsownerscanthenusefinancialmarketsforsavingorborrowing.Bothinvestorsarehappierthanin(),butDisnottheoptimalinvestmentplanyet.,C0,B,A,D,E,C1,slope=-(1+r),PV(D),ProjectValuationinaRisklessWorld,C0,A,D,E,slope=-(1+r),PV(Y),C1,B,Y*,Y1,Y0,Y*istheoptimalinvestmentplan,whichistheonethatmaximizesNPV(Y)PV(Y)EorPV(Y).Perfectcapitalmarket(borrowingratelendingrate)isassumed.,CorporateInvestmentDecisionMaking,Inreality,shareholdersdonotvoteoneveryinvestmentdecisionfacedbyafirmandthemanagersoffirmsneeddecisionrulestooperateby.AllshareholdersofafirmwillbemadebetteroffifmanagersfollowtheNPVruleundertakepositiveNPVprojectsandrejectnegativeNPVprojects.,OptimalInvestmentPlan,NetPresentValueNPVPV(Y)ETherefore,thebestinvestmentplanistheonethatmaximizesNPV(Y);andthebestinvestmentplanisindependentofinvestorspreferences.,PVNPV,FishersSeparationPrinciple,Givenperfectcapitalmarketandcertainty,theoptimalinvestmentplanistheonethatmaximizesthenetpresentvalueofavailableproductionplans,withoutregardtotheindividualssubjectivepreferencesthatenterintotheirconsumption/savingdecisions.(IrvingFisher),Thisisthebasisforusingthepresentvalueastheevaluationcriterion.SeparationofinvestmentandfinancingdecisionsSeparationofownershipandmanagement.,WhydoweuseNPVorPVasinvestmentcriterion,NPVasInvestmentCriterion,2.3PresentValueandCompounding,Howmuchwouldaninvestorhavetosetasidetodayinordertohave$20,000fiveyearsfromnowifthecurrentrateis15%?,$20,000,PV,HowLongistheWait?,Example5:Ifwedeposit$5,000todayinanaccountpaying10%,howlongdoesittaketogrowto$10,000?,Example6:Assumethetotalcostofacollegeeducationwillbe$50,000whenyourchildenterscollegein12years.Youhave$5,000toinvesttoday.Whatrateofinterestmustyouearnonyourinvestmenttocoverthecostofyourchildseducation?,WhatRateIsEnough?,2.4PVwithSpecialCashFlows,PerpetuityAconstantstreamofcashflowsthatlastsforever.GrowingperpetuityAstreamofcashflowsthatgrowsataconstantrateforever.AnnuityAstreamofconstantcashflowsthatlastsforafixednumberofperiods.GrowingannuityAstreamofcashflowsthatgrowsataconstantrateforafixednumberofperiods.,Perpetuity,Aconstantstreamofcashflowsthatlastsforever.,Theformulaforthepresentvalueofaperpetuityis:,GrowingPerpetuity,Agrowingstreamofcashflowsthatlastsforever.,Theformulaforthepresentvalueofagrowingperpetuityis:,Annuity,Aconstantstreamofcashflowswithafixedmaturity.,Theformulaforthepresentvalueofanannuityis:,GrowingAnnuity,Agrowingstreamofcashflowswithafixedm