Case Marriott Cost Of Capital

Case Report #6: Marriott pot Memo From: theatre:Marriott Corporation : The Cost of Capital Problem:Marriott Corporation inevitably to determine competent hurdle range for separately of its tercet regions. These rates testament be used to discount bullion flows of potential future(a) projects. Options:1. Compute the WACC under the classical tax organisation for the company as a whole and for each division of the company 2. stupefy recommendations for hurdle rates of Marriotts different divisions to distribute by discounting take over cash flows by the break away hurdle rate for each division Recommendation: given the policies and strategies related with hurdle rates and cost of capital, Marriot Corporation should learn their target debt/value grammatical construction because it will disparage their weighted average cost of capital. epitome:Marriot Corporation is a 1927 US-based company specialized in the hotel direction industry. Its operations and merchandise line crap expanded advantageously in the abide few decades and the management team reckon to re chief(prenominal) a premier ingathering company.

As a consequence, - (to keep on growing it will need to spend in spick-and-span 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 electron lens to remain a premier growth company. In fact, their argument organisation goals consist of keeping a significant growth tone by setting consist ent credit line strategies and maturation ! appropriate investment opportunities in their different business divisions. In the uniform line of thought, Marriott is determined to develop and to enhance its spatial relation in each division. Marriott Corporation has 3 major lines of business: lodging, contract services and restaurants. In rules of order to achieve their goal, the managers of Marriott have genuine a well-rounded financial strategy with quatern main decisions. The four...If you want to get a full essay, order it on our website: BestEssayCheap.com

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