Firm’s Capital

The purpose of this assignment is to analyze a firm’s capital structure and its impact on firm performance. Explain core concepts related to business risk, and recommend sound financial decisions based on analysis of a firm’s capital structure and capital budgeting techniques.

Read the Chapter 15 Mini Case in Financial Management: Theory and Practice. Complete Parts 1 and 2.

Part 1: Using complete sentences and academic vocabulary, please answer questions A through C.

Part 2: Using the mini case information, write a 250-word recommendation of the financial decisions you propose for this company based on an analysis of its capital structure and capital budgeting techniques. Explain why you chose this recommendation and how it will impact the performance of the firm.

 

Sample Solution

Many different environmental scientists have proposed different potential foundations for environmental ethics. Bryan Norton, in particular, proposes the idea of transformative value, which offers respectable and defensible approaches to protecting species and ecosystems. Transformative value has the ability to sort human demand values in a way that provides environmentalists a solid way to not only criticize modern society’s rampant overconsumption and materialism, but also creates a way to defensibly advocate for wild species and ecosystems.

To begin with, transformative value is the ideology that a person’s experience in nature can alter their real-life preferences, specifically in relation to consumption of goods and their ecological footprint. Aesthetic value splits into two different approaches, both of which fall in line with transformative value. Lilly-Marlene Russow follows a traditional approach, which is based on the value of physical experience in nature. People highly value experience; it is why people spend years planning on trips to Greece or to see the Mona Lisa in person. People do not travel across the planet because they have never seen a country or piece of artwork before but because the process of experiencing those things in person is so revered. Species and ecosystems evoke those same kinds of feelings. Visually appealing organisms like birds of paradise or African elephants and similarly appealing ecosystems like coral reefs and tropical rainforests evoke a sense of awe and admiration that is valuable to people, so individuals are more likely to protect them.

The desire to physically see these organisms or habitats further intensifies these feelings. While any person can look up pictures of sloths or vibrant coral, the potential to be close to the physical organism drives a desire to preserve them and their habitats. This also explains why endangered species have more done to protect them when compared to healthy species. Since there is a higher threat of losing the potential experiences forever, more work is put into saving and rebuilding those species rather than a well-populated one. The value of experience creates a ranking system that scientists are able to use to determine which species or ecosystem needs the most assistance and advocacy. In addition, Transformative value largely uses this experience desire as a stepping stone. Individuals who desire these experiences will want to protect these ecosystems and animals until they can have the opportunity to see them up close. Those who are able to actually achieve those experiences usually leave with a solidified respect and admiration for the species or ecosystem they visited. The vast amounts of social media posts about experiences like African safaris and hiking up mountains or scuba diving in the Great Barrier Reef show this change. The positive outcome of that experience solidifies already held values about that species or ecosystem, pushing people to pay more attention to the health of that location or species, specifically in how their own individual behavior affects those places. If a person, for example, tends to enjoy the beautiful colors of the Scarlet Macaw but watches one suffocate on a piece of plastic, they can experience a shift in their behavior. A general, vague admiration for the visual aspect

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