Lending Institutions

Question 1

“International Finance” Please respond to the following:

• Based on the lecture and Webtext materials, address the following:
  
  • The IMF and World Bank are the world’s two leading lending institutions, but much of their monetary assistance disappears once it enters the banking systems of developing countries. Cite concrete evidence that supports the assertion that much assistance to developing countries is simply stolen by officials. Determine other main factors that account for the misuse of these funds.

Question 2

Each answer should not exceed one page in length. Each and every answer must be your own work product. If you supplement your answer with additional sources, be sure to properly cite that source.

1. Does the Comparable Company Analysis and Precedent Transaction Analysis ever provide the same result for a target company?
2. Does the consideration of synergies affect valuations?
3. What is more important – the determination of the cash flow mapping or the computation of the weighted average cost of capital – in discounted cash flow approaches?
4. Why in the Comparable Company Analysis are we concerned with equity price stickiness? Also address why equity price stickiness exists.
5. To an equity analyst is EV/EBIT or EV/EBITDA more important?
6. What is the difference between market price and intrinsic value?