proposal
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Prepare a 4,250- to 6,250-word proposal in which you select the optimal financing and investment strategy for your scenario.- Please remember that the scenario we chose is, “A manufacturing organization considering expansion to India or Brazil” – so information provided should be relevant to that situation!
3 parts to be written 400 word each , with one reference .
Include the following information in your proposal:
· Identify which country you chose and why. – Everyone is indicating India as our choice. Teana can do a section on why we are choosing this taking data from our prior papers
· Identify foreign exchange rate data. – Teana already has this from prior papers so can add a section about the exchange rates
· Use foreign exchange and cost of capital data to determine appropriate capital sources. – Teana can take this, and I have tomorrow afternoon off to work on it as it seems like we need this part to be able to do the sensitivity analysis.
Conduct a sensitivity analysis, based on the following questions: – I had previously noted that info on sensitivity analysis was in chapter 14 of the text by Madura but that chapter was never assigned. I am behind on the reading so does anyone else know where in our texts that the instructions for sensitivity analysis are provided?
o What if funds are blocked? How does this affect the parent organization? – Aliy
o What if the subsidiary provided funds? – Aliy
o How does the source of capital affect the subsidiary and parent organization? -ALIY
o What sources of capital would minimize the cost of capital to the subsidiary? – Donnika
What happens if the country you chose provides incentives to invest? Now that your organization is profitable, the country is taking incentives back. How do you determine the residual value at the end of the project life? – Donnika
o How is the value of an organization determined from the following perspectives? – Donnika
· Expiration of project life · Friendly or unfriendly buyout · Economic decision to change locations · Nationalization or confiscation of organization Identify available alternative investment and financing decisions, and make a final recommendation. – Timothy
o Use the capital budgeting technique to justify your conclusions. Support your choice of the discount rate used in the calculation of net present value. – Teana
o Develop a contingency plan based on your sensitivity analysis. Modify your investment and financing strategy based on the identified changing global risk factors. – Timothy
o Include appropriate spreadsheets displaying a financial analysis in your proposal. If you used an electronic source, include the Uniform Resource Locator (URL). If you used a print source, attach a copy to your paper. – Teana
