Reference no: EM133435039

Question: Almost all business activities, including marketing, management, operations, strategy, and more, involve consideration of cash outlays made now or in the current time period in exchange for some forecasted or expected benefits in the future. The same is true for personal and family financing activities such as setting aside funds for an education or for retirement. And many times the benefit comes first and we need to budget for future expenditures such as loan repayments.

Week Three is a "tools module" that provides the foundational elements for analyzing business and personal decisions that involve costs or expenditures in one time period in exchange for benefits in another time period. Business applications include valuing bonds and stocks, determining the return investors expect and require the business to deliver, evaluating various long-term strategies, evaluating long-term investments such as building new facilities, acquiring another firm, expanding into a new product market or new geographical market or going global, to name some.

Please comment on any organizational initiatives or opportunities in which you have been involved or which you may have heard where the business problem involves investment in one period (typically now) in exchange for benefits in some other period or periods (typically in the future). In broad terms, what are the issues you considered? Was terminology such as present value or future value or net present value used in these discussions? Does this terminology mean anything to you now? (It will when you complete EMBA 7015.) How did these discussions relate to strategic efforts to create value?

If you have not had the opportunity to participate in organizational discussions of this type, you may comment about some consumer-style activities you are familiar with. For example, if you borrowed to help finance an education or purchase a home or a car or Lear Jet, what were the important variables you considered before deciding to go forward?