Assume that you are the owner of a professional team that has been just short of making the playoff for the last few years. You have the opportunity of obtaining a new player that you are certain (yes, u realize that nothing is certain) can put you over the top and get you into the post season and all the benefits that brings. Explain in detail the steps you would take and the cash flows you would consider in order to make this capital budgeting decision (Yes, it is a capital budgeting decision) in your negotiations with the player, how would u know you had reached the max amount you could offer We have seen that over long periods, stock investments have tended to substantially outperform bond investments. However, it is common to observe investors with long horizon holding entirely bonds. Are such investors irrational? What is behavioral finance and how does it help explain some of the things we have seen in the market in recent years that are difficult to explain using pure finance theory? Give some example of investor behavior that may conflict with rational investments decisions? Is it possible to be too risk averse? If so what is the downside of being too risk averse? Wife is suffering from some personal ‘agency’ problems caused by husband. Interpreted the statement and give some example of agency problems in the business world and outline some ways to minimize these problems. Investors dramatically sold off Boeing stock resulting in a 40% reduction in stock price after a new Boeing Dreamliner crashed and news stations reported that it was due to a structural failure. Later reports accurately reported that a terrorist boom was the true cause of the crash. The stock recovered quickly. Is this an example of an unexplained market. Explain in detail. A stock market analysis is able to identify misplaced stocks by comparing the average price for the last 10 days to the average price for the last 60 days. If this is true, what do you know about the market? Explain in detail. Several celebrated investors and stock pickers frequently mentioned in the financial press have recorded huge returns in their investments over the past two decades. Is the success of these particular investors invalidation of EMH? Explain

Assume that you are the owner of a professional team that has been just short of making the playoff for the last few years. You have the opportunity of obtaining a new player that you are certain...

Assume that you are the owner of a professional team that has been just short of making the playoff for the last few years. You have the opportunity of obtaining a new player that you are certain (yes, u realize that nothing is certain) can put you over the top and get you into the post season and all the benefits that brings. Explain in detail the steps you would take and the cash flows you would consider in order to make this capital budgeting decision (Yes, it is a capital budgeting decision) in your negotiations with the player, how would u know you had reached the max amount you could offer

We have seen that over long periods, stock investments have tended to substantially outperform bond investments. However, it is common to observe investors with long horizon holding entirely bonds. Are such investors irrational?

What is behavioral finance and how does it help explain some of the things we have seen in the market in recent years that are difficult to explain using pure finance theory? Give some example of investor behavior that may conflict with rational investments decisions?

Is it possible to be too risk averse? If so what is the downside of being too risk averse?

Wife is suffering from some personal ‘agency’ problems caused by husband. Interpreted the statement and give some example of agency problems in the business world and outline some ways to minimize these problems.

Investors dramatically sold off Boeing stock resulting in a 40% reduction in stock price after a new Boeing Dreamliner crashed and news stations reported that it was due to a structural failure. Later reports accurately reported that a terrorist boom was the true cause of the crash. The stock recovered quickly. Is this an example of an unexplained market. Explain in detail.

A stock market analysis is able to identify misplaced stocks by comparing the average price for the last 10 days to the average price for the last 60 days. If this is true, what do you know about the market? Explain in detail.

Several celebrated investors and stock pickers frequently mentioned in the financial press have recorded huge returns in their investments over the past two decades. Is the success of these particular investors invalidation of EMH? Explain

May 25, 2022