General Electric Company is one of the most acknowledged companies across the world. The company's center of operations is situated in Boston. In particular, the manufacturing company has various business operations in different segments. These include oil and gas, power and water, aviation and transportation. This shows the company's versatility in manufacturing as it ranges from the engineering industry to automotive industry. The company's prevailing revenue generated lies in the range of $140.39 billion as of the 2015 fiscal year. In the 2012 financial year, the company was ranked as the fourth biggest firm in the world. General Electric Company manufactures aircraft engines, locomotives and other transportation apparatus, lighting, electric control gear, generators and turbines, and medical imaging paraphernalia. In addition, the company is the owner of GE Capital, which provides commercial finance, commercial aircraft leasing, real estate, and financial services for the energy sector (Hoovers, 2016). Since its establishment in 1892, General Electric has expanded its business operations to various nations across the world. With the incessant growth rate and development of emerging markets, the company has a great opportunity to further expand and propagate its business operations (General Electric, 2016).Suggest a methodology to supplement the traditional methods for evaluating the capital investments of your selected company in the emerging markets to reduce risk. Provide a rationale for your suggested methodology
A recommended methodology to supplement the traditional methods for evaluating the capital investments of General Electric Company in the emerging markets to reduce risk is the discounted payback method. This approach can be very beneficial to the firm, particularly owing to the various business sides. The payback period is one of the simplest methods of evaluating capital investment. In this case, projects or investments with a shorter payback period are more often preferred for investment in comparison to investment with longer payback periods. However, with respect to the discount payback period, the time value of money, also referred to as the discounted value of cash flow is taken into account for calculating the payback period (Capital Investment, 2016). Therefore, this is the period necessitated to recover the initial cash investment for a project, which is equivalent...
Capital Investments in Emerging Markets The Procter & Gamble Corporation (P&G) is one of the largest manufacturing companies on the global scene. P&G undertakes its business operations in approximately eighty nations and retails its products in over 180 nations. At present, the company has about thirty five manufacturing plants that are responsible for handling manufacturing and production across the globe. In the preceding year, about 35% of the total revenue generated
Johnson Controls Emerging markets are riskier than established ones, and because of that Johnson Controls should make some adjustments to the method by which it evaluates capital investments when dealing in emerging markets. The 2013 Outlook and Strategic Review does not explain how risk is evaluated at Johnson, but the company would normally subject its capital investments to analysis that includes sensitivity analysis, and NPV with sensitivity analysis. For emerging markets, the
Global Capital Investment There is some proof that capital through financial globalization may raise the growth rate in developing countries. "Traditionally, fixed exchange rates have been considered to require more reserves than flexible rates. Fluctuations in the balance of payments would be taken care of by compensatory exchange rate adjustments under a flexible regime, whereas they involve temporary swings in reserve holdings under a fixed regime. With flexible rates, fundamental disequilibria
Gupta, S., & Shapiro, D. (2014). Building and Transforming an Emerging Market Global Enterprise: Lessons from the Infosys Journey. Business Horizons, 57(2), 169 -- 179. Credibility: Author Analysis Daniel M. Shapiro is a Global Business Strategy Professor at the Simon Fraser University in Beedie's School of Business. He has a work record of over forty years as an academic administrator, educator, and researcher. Recently, he became Dean of the Business School. He
Capital Budgeting and Government Regulations Airline Industry LONG-TERM CAPITAL BUDGETING IN AIRLINE INDUSTRY Government regulation: Why or why not Major reasons for government involvement in a market economy Interests of stockholders and managers: The convergence Airline: Merger or new capital investment LONG-TERM CAPITAL BUDGETING IN AIRLINE INDUSTRY For profit organizations have shareholder's profit maximization as the main aim to pursue. Traditional managerial economics expects that all projects/investments having positive net present value (NPV) shall be initiated by
Investment Portfolio For this client, the total investment is $100,000. This is not the sum total of the investor's assets, but it will be invested in a diversified portfolio. It is assumed that the time horizon is medium-to-long-term. The investment portfolio will be built using the top-down approach, whereby asset classes are first determined and then the individual securities within those classes are determined subsequent. The first step in this process
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