In this teaching note we show that using the findings of Tham and Velez-Pareja 2002, for finite cash flows, Ke and hence WACC depend on the discount rate that is used to value the tax shield, TS and as expected, Ke and WACC are not constant with Kd as the discount rate for the tax shield, even...

We discuss some ideas useful when forecasting financial statements that are based on historical data.The chapter is organized as follows: First we discuss the relevance of prospective analysis for non traded firms. In a second section we a basic reviews of subjects that will be needed for...

It is widely known that if the leverage is constant over time, then the cost of equity and the Weighted Average Cost of Capital (WACC) for the free cash flow, FCF, is constant over time. In other words, it is inappropriate to use a constant WACCFCF to discount the free cash flow (FCF) if the...

In this teaching note I list some suggestions that might be useful to take into account when forecasting financial statements departing from historical data. The ideas presented in this note are the result of advising undergraduate and graduate students in the course Econ 195.96/295.96...

In this work we show a simplified financial planning model. In reality, financial planning models are huge and cumbersome. This is a very simplified model compared with what is found in practice.We present some basic principles for constructing the financial statements needed for valuation. We...

In this teaching note the reader finds a simplified financial model. In reality, financial models are huge and cumbersome. What we present is very simplified model in comparison to what is found in practice. We indicate the formulas that have to be utilized in the construction of the financial...

En la práctica financiera y la enseñanza de las finanzas el tratamiento que se le da a algunos de los conceptos más importantes en la evaluación de proyectos y la valoración de empresas en muchos casos es por decir lo menos, ligero. Por un lado está la determinación de los flujos de caja...

En este trabajo explicamos el uso apropiado de perpetuidades y el cálculo de su valor. Consideramos dos casos: calcular el valor en el período cero cuando la perpetuidad comienza con un flujo de caja dado en el período 1 y cuando se conoce el flujo de caja en el período cero y crece en el...

Esta nota pedagógica ilustra el cálculo de la elasticidad precio-demanda y su aplicación en la proyección de estados financieros.

Al calcular los ahorros en impuestos, AI, nos enfrentamos a una extraña mezcla de causación contable y de valor de mercado cuando se trata de incluir el AI en el cálculo del Costo promedio ponderado de capital, CPPC (WACC por sus siglas en inglés) o el costo del patrimonio con deuda, Ke. Las...