跨国财务管理培训课件.pptVIP

* 2. The APV Model The APV model is a value-additivity approach to capital budgeting. Each cash flow that is a source of value to the firm is considered individually. Note that with the APV model, each cash flow is discounted at a rate that is appropriate to the risk of the cash flow. APV = S t = 1 T (OCFt)(1 – t) (1 + Ku)t C0 TVT (1 + Ku)T + t Dt (1 + i)t + – t It (1 + i)t + 第六十页，共一百一十页。 Domestic APV Example Consider this project, the timing and size of the incremental after-tax cash flows for an all-equity firm are: 0 1 2 3 4 -$1,000 $125 $250 $375 $500 The unlevered cost of equity is r0 = 10%: The project would be rejected by an all-equity firm: CF0 = –$1000 CF1 = $125 CF2 = CF3 = $375 r0 = 10% NPV = –$56.50 CF4 = $500 $250 第六十一页，共一百一十页。 Domestic APV Example (continued) Now, imagine that the firm finances the project with $600 of debt at r = 8%. The tax rate is 40%, so they have an interest tax shield worth t×I = .40×$600×.08 = $19.20 each year. 第六十二页，共一百一十页。 APV = $125 1.10 0 1 2 3 4 -$1,000 $125 $250 $375 $500 + $250 (1.10)2 + $375 (1.10)3 + $500 (1.10)4 + $19.20 (1.08)2 + $19.20 (1.08)3 + $19.20 (1.08)4 $19.20 1.08 + – $1,000 APV = $7.09 The APV of the project under leverage is: The firm should accept the project if it finances with debt. APV = S t = 1 T (OCFt)(1 – t) (1 + Ku)t C0 TVT (1 + Ku)T + t Dt (1 + i)t + – t It (1 + i)t + 第六十三页，共一百一十页。 2. The APV Model The APV model is useful for a domestic firm analyzing a domestic capital expenditure or for a foreign subsidiary of a MNC analyzing a proposed capital expenditure from the subsidiary’s viewpoint. The APV model is NOT useful for a MNC in analyzing a foreign capital expenditure from the parent firm’s perspective. APV = S t = 1 T (OCFt)(1 – t) (1 + Ku)t C0 TVT (1 + Ku)T + t Dt (1 + i)t + – t It (1 + i)t + 第六十四页，共一百一十页。 * Key words Borrowing capacity Concessionary loan Lost sales