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Fourth Quarter 2007
Article

Contingent Claims Approach to Measuring and Managing Sovereign Credit Risk

By: Dale . F. Gray, Robert C. Merton and Zvi Bodie

This paper proposes a new approach to measure, analyze, and manage sovereign risk based on the theory and practice of modern contingent claims analysis (CCA). The paper provides a new framework for adapting the CCA model to the sovereign balance sheet in a way that can... View Details

Keywords: Credit; Investment; Sovereign Finance; Risk Management; Emerging Markets; Market Transactions; Mathematical Methods; Valuation

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2007
Working Paper

The Ethical Mirage: A Temporal Explanation as to Why We Aren't as Ethical as We Think We Are

By: Ann E. Tenbrunsel, Kristina A. Diekmann, Kimberly A. Wade-Benzoni and Max H. Bazerman

This paper explores the biased perceptions that people hold of their own ethicality. We argue that the temporal trichotomy of prediction, action and evaluation is central to these misperceptions: People predict that they will behave more ethically than they actually... View Details

Keywords: Forecasting and Prediction; Ethics; Behavior; Cognition and Thinking; Perception; Prejudice and Bias

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February 2007 (Revised January 2008)
Supplement

Multifactor Models (CW)

By: Malcolm P. Baker

Keywords: Asset Pricing; Cost of Capital; Forecasting and Prediction; Investment Funds; Investment Return; Mathematical Methods; Performance Evaluation

May 2006
Case

Nokia in 2003

By: Paul M. Healy

Examines the challenges facing a money manager who owns stock in Nokia, the leading wireless handset provider. Two analysts covering the stock make very different predictions about the economies of the industry, Nokia's future performance, and stock recommendations.... View Details

Keywords: Financial Reporting; Forecasting and Prediction; Performance Effectiveness; Performance Evaluation; Problems and Challenges; Electronics Industry

November 2003 (Revised March 2004)
Case

Drilling South: Petrobras Evaluates Pecom

By: Mihir A. Desai and Ricardo Reisen de Pinho

The Brazilian oil company, Petrobras, is evaluating the acquisition of an Argentine oil company, the Perez Companc Group (Pecom). The acquisition would increase Petrobras' oil reserves and expand its interests outside Brazil, a significant step for the largest company... View Details

Keywords: Mergers and Acquisitions; Forecasting and Prediction; Financial Crisis; Non-Renewable Energy; Cross-Cultural and Cross-Border Issues; Corporate Governance; Risk Management; Emerging Markets; State Ownership; Performance Evaluation; Risk and Uncertainty; Valuation; Energy Industry; Argentina; Brazil

October 2002 (Revised January 2013)
Case

Krispy Kreme Doughnuts

By: Paul M. Healy

Krispy Kreme is a rapidly growing firm with a business model that has excited Wall Street. View Details

Keywords: Business Growth and Maturation; Business Model; Financial Statements; Forecasting and Prediction; Financial Reporting; Performance Evaluation; Business Strategy; Food and Beverage Industry; New York (city, NY)

September 2001 (Revised April 2002)
Case

Ocean Carriers

By: Erik Stafford, Angela Chao and Kathleen Luchs

In January 2001, Mary Linn, vice president of finance for Ocean Carriers, a shipping company with offices in New York and Hong Kong, was evaluating a proposed lease of a ship for a three-year period, beginning in early 2003. The customer was eager to finalize the... View Details

Keywords: Cash Flow; Forecasting and Prediction; Cost of Capital; Leasing; Corporate Strategy; Valuation; Shipping Industry; New York (city, NY); Hong Kong

January 2001 (Revised July 2003)
Case

Pharmacyclics: Financing Research & Development

By: Malcolm P. Baker, Richard S. Ruback and Aldo Sesia

Pharmacyclics (NASDAQ: PCYC), a pharmaceutical company that manufactures products that will improve existing therapeutic treatments for cancer, arteriosclerosis, and retinal disease, was considering a $60 million private placement in February 2000. The company had more... View Details

Keywords: Valuation; Cash Flow; Financing and Loans; Business Startups; Financial Strategy; Medical Devices and Supplies Industry; Pharmaceutical Industry; Health Industry

November 1999 (Revised July 2003)
Case

Pre-Paid Legal Services, Inc.

By: Paul M. Healy and Jacob Cohen

Pre-Paid Legal Services' business model reveals two key issues--managing the sales force and sales growth and managing claims. Students analyze the economics of the business and consider how to measure firm performance, how to evaluate and reward the sales force, and... View Details

Keywords: Financial Management; Financial Strategy; Salesforce Management; Marketing Strategy; Accrual Accounting; Business Cycles; Forecasting and Prediction; Insurance; Business Growth and Maturation; Insurance Industry

April 1998 (Revised November 1999)
Case

Hamilton Financial Investments: A Franchise Built on Trust

By: Robert L. Simons and Antonio Davila

Provides a vehicle for students to evaluate risk management in the fast-paced mutual funds industry. A new risk manager has been hired to install new management controls and procedures. A series of decisions will determine how much business and franchise risk the... View Details

Keywords: Risk Management; Management Teams; Managerial Roles; Forecasting and Prediction; Investment Funds; Performance Evaluation; Corporate Strategy; Change Management; Financial Services Industry; Banking Industry

October 1991 (Revised January 2002)
Case

Butler Lumber Company

The Butler Lumber Co. is faced with a need for increased bank financing due to its rapid sales growth and low profitability. Students must determine the reasons for the rising bank borrowing, estimate the amount of borrowing needed, and assess the attractiveness of the... View Details

Keywords: Commercial Banking; Financial Crisis; Borrowing and Debt; Financial Strategy; Financing and Loans; Capital Structure; Forecasting and Prediction

June 1991 (Revised December 1997)
Case

Takeover of the Norton Co., The

After a decade of mediocre performance, the Norton Co. enters 1990 with the prospect of increased sales in the next few years. Yet Norton is pursuing slow growth industries, and a lower than expected earnings announcement at the beginning of 1990 has depressed earnings... View Details

Keywords: Mergers and Acquisitions; Business Conglomerates; Goals and Objectives; Forecasting and Prediction; Performance Evaluation; Revenue; Bids and Bidding; Business Processes; Ownership Stake

April 1991 (Revised December 1997)
Case

Southland Corp. (A)

By: Richard S. Ruback

Examines the Thompson's $4.9 billion leveraged buyout of the Southland Corp. in 1987. As the original founders of Southland, the Thompsons were concerned about losing control over the company upon learning of the Belzberg family's acquiring interest. The teaching... View Details

Keywords: Leveraged Buyouts; Governance Controls; Corporate Governance; Bids and Bidding; Valuation; Forecasting and Prediction; Management Analysis, Tools, and Techniques; Strategy; Cash Flow

June 1990 (Revised January 1993)
Case

Dynatronics, Inc. (Abridged)

Provides an opportunity to evaluate an investment in a new product line in strategic, competitive, organizational, and economic terms. The economic analysis involves an estimation of the relevant cash flows and discounting them at an appropriate hurdle rate. View Details

Keywords: Product; Forecasting and Prediction; Investment; Capital Budgeting

January 1983 (Revised September 1983)
Case

E.T. Phone Home, Inc.: Forecasting Business Demand

By: John F. Cady and Frank V. Cespedes

Describes a process for forecasting market demand for an emerging technology--cellular radio. The student must critically evaluate the demand model and the market estimates, and modify them as appropriate in order to develop a marketing plan and budget. View Details

Keywords: Budgets and Budgeting; Forecasting and Prediction; Marketing Strategy; Demand and Consumers; Business Processes; Technology

Article

On Market Timing and Investment Performance Part II: Statistical Procedures for Evaluating Forecasting Skills

By: Robert C. Merton and Roy D. Henriksson

Keywords: Investment; Performance; Mathematical Methods; Forecasting and Prediction

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November 1974 (Revised May 1994)
Case

Science Technology Co.

The president of a medium-sized electronics company is evaluating the financial forecasts and proposed financing program submitted by the chief financial officer. The forecasts are prepared in constant dollars, on which basis the proposed financing plan seems... View Details

Keywords: Currency; Financial Strategy; Forecasting and Prediction; Inflation and Deflation; Risk and Uncertainty; Outcome or Result; Technology Industry; Electronics Industry