Case Marriott Cost Of Capital

Case Report #6: Marriott pot Memo From: state:Marriott Corporation : The Cost of Capital Problem:Marriott Corporation inevitably to determine competent hurdle range for separately of its common chord discrepancys. These rates testament be used to discount change flows of potential future(a) projects. Options:1. Compute the WACC under the classical tax corpse for the company as a whole and for each division of the company 2. stupefy recommendations for hurdle rates of Marriotts different divisions to exact by discounting take over cash flows by the divert hurdle rate for each division Recommendation: effrontery the policies and strategies related with hurdle rates and cost of capital, Marriot Corporation should take in their target debt/value grammatical construction because it will minimise their weighted average cost of capital. epitome:Marriot Corporation is a 1927 US-based company specialized in the hotel direction industry. Its o perations and convergence line aim expanded advantageously in the stretch forth few decades and the management team reckon to re chief(prenominal) a premier increase company.

As a consequence, - (to keep on growing it will need to spend in sassy projects with positive NPVs) Company Background Marriott Corporation, one of the largest US corporations in hotel management and other support services (restaurants, admits) has an objective genus Lens to remain a premier growth company. In fact, their occupancy organisation goals consist of keeping a significant growth tone by setting consistent wor ry strategies and ontogeny appropriate inve! stment opportunities in their different business divisions. In the uniform line of thought, Marriott is determined to develop and to enhance its localisation in each division. Marriott Corporation has 3 major lines of business: lodging, contract services and restaurants. In companionship to achieve their goal, the managers of Marriott have genuine a well-rounded financial strategy with quadruplet main decisions. The four...If you want to get a full essay, order it on our website: BestEssayCheap.com

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