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BE Oil
Murphy, Daniel; Lipson, Marc L.Case DARDEN-GEM-0161-EEconomicsQuentin Bell, the owner of a small oil extraction firm, BE Oil, owns the rights to drill on six different wells. Drilling requires substantial up-front costs, and each well has different drilling costs and production capability. Bell’s challenge is to decide which wells to drill based on his expectation of the price of oil when it is extracted. The case was written for use in Darden’s global economies and markets (GEM) core course during a class...Starting at €8.20
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Kelly Solar - Teaching Note
Lipson, Marc L.; Bodily, Samuel E.; Lichtendahl, Kenneth C. Jr.Teaching Note DARDEN-F-1614TN-EFinanceTeaching note for product F-1614Starting at €0.00
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Kelly Solar
Bodily, Samuel E.; Lipson, Marc L.; Lichtendahl, Kenneth C. Jr.Case DARDEN-F-1614-EFinanceA small start-up company must make additional investments to maximize its firm value. But the company owner will not make this investment unless she can renegotiate outstanding debt claims. Solving this "debt overhang" problem through negotiation is the focus of the case. In this context, students are exposed to a variety of issues: the nature of financial claims, bargaining and negotiation fundamentals, and agency costs of debt.Starting at €8.20
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Langtry Falls Expansion Plan
Lipson, Marc L.Case DARDEN-F-1804-EFinanceIt was generally accepted that the weighted average cost of capital (WACC) for a company reflected an appropriate hurdle rate (minimum return or benchmark) for that company’s investments. But a WACC for Langtry Falls could not be calculated because the company did not have publicly traded stock, a critical source of one input to the calculation. However, the benchmark for publicly traded competing companies would be meaningful to Langtry—these co...Starting at €8.20
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Harley-Davidson, Inc.: The Reverse Yankee Bond Issue
Lipson, Marc L.; O'Brien, RobbyCase DARDEN-F-2046-EFinanceHarley-Davidson Inc. (Harley-Davidson), the storied maker of iconic American motorcycles, was on the cusp of issuing its first bond not denominated in US or Canadian dollars—a so-called Reverse Yankee bond issue denominated in euros. Macroeconomic factors suggested that a euro issue could take advantage of the extremely low real rates of return in European markets that resulted from government monetary policies and a weak economy. On the other ha...Starting at €8.20
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Hightrek Inc.
Lipson, Marc L.Case DARDEN-F-1748-EFinanceA small manufacturer of camping gear is considering a new product that would expand its market. The product is a portable “hoophouse” that would allow people to begin planting gardens earlier in the season by trapping heat and keeping frost at bay. It would use existing technology but would be a very different product line. The required analyses are simple net present value (NPV) and internal rate of return (IRR) calculations. However, through th...Starting at €8.20
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Danaher Corporation: The Hach SL1000 Portable Parallel Water Analyzer
Lipson, Marc L.Case DARDEN-S-0261-EStrategyThe Hach subsidiary of global science and technology leader Danaher Corporation was about to introduce an innovative handheld water quality testing device: the SL1000 Portable Parallel Analyzer. There were, however, some critical decisions left regarding how best to bring it to market. Olaf Boettger, the Business Unit Director of Hach’s Laboratory Solutions division, needed to decide on the exact timing of the launch and how the PPA would be pric...Starting at €8.20
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Dumbarton Bearing Supply, LLC: Recognizing Real Options
Lipson, Marc L.Case DARDEN-F-1990-EFinanceAngus MacIntyre, CEO of Dumbarton Bearing Supply, LLC (Dumbarton), is deciding whether to introduce a new ceramic ball-bearing product line and whether to produce those bearings by refitting an existing production line or by building a new production line. The initial analysis favors a refit—despite a much higher variable cost, the investment is relatively small, and as a result this approach poses little risk. However, this analysis does not rec...Starting at €8.20
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Geo Tech
Lipson, Marc L.Case DARDEN-F-1650-EFinanceThe founder of a U.S. provider of geographic information system services focused on sustainability must decide whether to open a Canadian facility. The facility would be in operation for five years and enough information is provided for a detailed cross-border capital budgeting analysis. In addition to introducing foreign currency issues, the case provides exposure to subscription-based revenue streams and discussion of relevant costs.Starting at €8.20
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Blue Ridge Bike and Hike
Lipson, Marc L.Case DARDEN-F-1749-EFinanceA small chain of retail stores selling outdoors equipment, Blue Ridge Bike and Hike (Blue Ridge) was expanding rapidly. The finance manager had to develop a financial plan for accommodating this growth and the investment it required. Clearly, the business was growing faster than could be financed from internal sources–-it had been increasing a long-term loan and had just ended the year with a higher-than-usual balance on its bank line of credit....Starting at €8.20