BUS 401 WEEK 4,
Identifying and Managing Risk. In In this assignment, you will compare and evaluate risk management techniques from experts in the field. Go to the Ashford University Library and find one article by Dr. James Kallman. Dr. Kallman, an expert in the field of risk management, has written many articles on managing financial risk. Find a second article in the Ashford University Library from another credible author of your choice who also provides recommendations for risk management.
Develop a three- to four-page analysis (excluding the title and reference pages), of the techniques Dr. Kallman has identified for managing risks. In this analysis, compare Dr.Kallman’s techniques to the techniques recommended in the second article you researched. Explain why you agree or disagree with each authors’ recommendations. Describe other factors you believe should be considered in risk management. The assignment should be comprehensive and include specific examples. The paper should be formatted according to APA.
You must cite at least two scholarly sources, in addition to the text, from the Ashford University Library, one being an article by Dr. Kallman.
Interviewing Peter Lynch. Review the “Minimizing Risk” video segment, which is available through your online course.
In the video segment, you will watch an interview with two great investors of the twentieth century. Imagine you are Harry Reasoner, and you are allowed to ask Peter Lynch one question about market risk, discount rates, or the
weighted average cost of capital (WACC). What question would you ask? Why do you feel that is an important question?
Guided Response: Review several of your classmates’ posts. Respond to at least two classmates. For oneclassmate response, answer the question that they have posed to Peter Lynch as if you were speaking for Peter Lynch. In your second classmate response, share whether you agree or disagree with a classmate’s answer to the Peter Lynch question.
ost of Capital. Corporations often use different costs of capital for different operating divisions. Using an example, calculate the weighted cost of capital (WACC). What are some potential issues in using varying techniques for cost of capital for different divisions? If the overall company weighted average cost of capital (WACC) were used as the hurdle rate for all divisions, would more conservative or riskier divisions get a greater share of capital? Explain your reasoning. What are two techniques that you could use to develop a rough estimate for each division’s cost of capital? Your initial response should be 200 to 250 words.
Guided Response: Review several of your classmates’ posts. Respond to at least two classmates by sharing whether you agree or disagree with their view of the use of the company’s capital. Explain your reasoning.
Risk and Return. We examined two very important topics in finance this week: risk and return. To summarize our discussion of the tradeoffs involved with risk and return, view the Evaluating Business Performance: Small Business Case Studies video available through your online course. Critically reflect on the importance of the risk and return balance. Consider the following:
Can we ever have any return without some type of risk?
If you take on a large risk, are you guaranteed a large return? Why or why not?
What other factors play into risks that are not covered in the video?
When have you had to consider risk and return in personal or professional decision-making?