The Effects of Debt Financing on Cashflows to Equity

In the analysis above, we assumed an additional capital expenditure of 50 Million BR in year 5, financed entirely with funds from equity; the cash flow to equity in year 5 (from exhibit 5.4) is -5,411 Million BR. If, instead, we had assumed the 50 Million BR had come from new borrowing, the cash flow to equity in year 5

a. will increase by 50 Million BR

b. will decrease by 50 Million BR

c. will remain unchanged Explain.

This spreadsheet allows you to estimate the cash flows to equity on a project

Exhibit 5.3: Estimated Net Income from Paper Plant Investment: Aracruz Cellulose
Retirement Planning For The Golden Years

Retirement Planning For The Golden Years

If mutual funds seem boring to you, there are other higher risk investment opportunities in the form of stocks. I seriously recommend studying the market carefully and completely before making the leap into stock trading but this can be quite the short-term quick profit rush that you are looking for if you am willing to risk your retirement investment for the sake of increasing your net worth. If you do choose to invest in the stock market please take the time to learn the proper procedures, the risks, and the process before diving in. If you have a financial planner and you definitely should then he or she may prove to be an exceptional resource when it comes to the practice of 'playing' the stock market.

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