I-1bre44380_idx_I1-I24 1 10/09/15 09:35 PM
Index
Note: Italicized page numbers indicate tables
and figures; page numbers followed by n
indicate notes.
A
Abandonment option, 264–265, 526, 580–582
project life and, 581
temporary, 581–582
valuation of, 581
Abbott Laboratories, 849
Abnormal return, 333, 333n
ABS (asset-backed securities), 618, 622–623,
635, 636, 641
Absolute priority, 471
Absolute risk, 223
Accelerated depreciation, 142–144, 146n,
395 n, 655
Accelerated underwriting, 395n, 655
Accenture, 136
Accounting income, tax income versus, 14 4
Accounting rates of return, 739–741
nature of, 739–740
problems with, 741
Accounting standards, 656, 656n, 733–734,
828–829
Accounts payable, 768
Accounts receivable period, 765, 766
Accrued interest, 49n, 621
ACH (Automated Clearing House), 797–798
Acharya, V. V., 377, 623n
Acid-test ratio, 747–748
Acquire option, 585
Acquisitions. See Mergers
Actavis, 813, 829–830
Active investing, 180
Activist investors, 11
Adjusted present value (APV), 491, 508–511
additions to debt capacity, 508–509
for international projects, 511
issue costs and, 508–509
leasing and, 664
for valuing businesses, 509–511
Adler, B. E., 865
Administrative costs
in leasing, 654–655
in pooling risks, 677
Adverse selection risk, 677
After-tax weighted average cost of capital
(WACC), 225, 228–229, 452, 491–496,
512 –514
Agency costs, 12, 305–306
of borrowing, 474–476
reducing, 636
risk management and, 674, 675–676
Agency for International Development (AID),
802 n
Agency problem, 302–322, 889–890
agents versus principals, 12–13
compensation plans, 302–311, 373
costs. See Agency costs
monitoring role, 305–306
Ponzi schemes, 11–12
risk management and, 674, 675–676
risk taking and, 304–305
subprime mortgage crisis, 304–305, 308,
343–344, 374–375, 600–602, 623,
895, 896
transparency and, 882–883
Agency theory, 889–890
Agents, 12
Aggarwal, R. K., 321, 852n
Aghion, P., 862n
Agrawal, A., 833n
Agrawal, D., 606n, 607 n
Agricultural Bank of China, 384
AIG, 52, 374, 525, 602
Airbus, 263, 585–587
Air France-KLM, 525
Aivasian, V., 481n
Alabama Power, 66
Alcoa, 739
Alibaba Group, 384, 396
Alios BioPharma, 817
Allayanis, G., 726
Allen, Franklin, 169, 251, 344n, 377, 430, 454,
777, 867n, 881 n, 884, 890, 892n, 896 n
Allen, J., 865
Allen, L., 615
Allergan, 813
Alliance Automotive Group, 855
Allied Crude Vegetable Oil Refining
Corporation, 639–640
Allied Irish Bank, 375
Allman-Ward, M., 806
Allocated overhead, in net present value
analysis, 137
All-or-none underwriting, 387n
Alpert, M., 251n
Alpha, 333
Alpha Natural Resources, 66
Alpine bonds, 629
Alstom, 813
Alternative minimum tax (AMT), 143, 655
Altice, 813
Altinkilic, O., 395n
Altman, Edward I., 470n, 610 n, 615, 84 6n, 864
Amazon, 84, 411, 590
A. M. Best, 608n
American Airlines (AMR), 366, 600, 607,
655, 827
American International Group (AIG), 52, 374,
525, 602
American Jobs Creation Act (JOBS) of 2004,
666 n
American options, 526, 551n, 564–565, 566
Amortization, 32
Amortizing loans, 31–32
AMR (American Airlines), 366, 600, 607,
655, 827
Amran, M., 592
AMT (alternative minimum tax), 143, 655
Anadarko, 80, 80Anders, C., 845n
Andrade, G., 470, 470n, 827, 827n, 835, 835n,
836, 838
Angel investors, 381–382
Anglo-Irish Bank, 852n
Anglo-Saxon financial system, 733–734,
867–871, 875–877
Annual coupon, 47–48
Annually compounded rate, 47–48
Annual percentage rate (APR), 36–39
Annuities, 28–35. See also Equivalent annual
cost
defined, 28
growing, 34–35
level and declining, 658n
valuation of, 28–30
annual payments, 31–32
annuities due, 31
future value, 33
growing annuities, 34–35
installment plan costing, 29–30
lottery winnings, 30
present value, 28–30
Annuity due, 31
Annuity factor, 28–30
Anomalies, 337
Anthony, R., 313n
Antikarov, V., 592
Antitrust law, mergers and, 827–828
Aoki, M., 873n, 884
AOL, 349, 815
Apex One, 815
Apollo Management, 844
Apple Computer Inc., 11–12, 174, 181, 196,
200, 386 n, 411, 427, 428, 738, 739, 761,
800
Appropriation requests, 250–251
APR (annual percentage rate), 36–39
APT (arbitrage pricing theory), 207–208
APV (adjusted present value), 508–511, 664
Aramark, 385
Arbitrage
defined, 58, 342
Delta One desks, 695
limits to, 342–343
market efficiency and, 342–343
money machine and, 58, 711
risk, 835n
risk-neutral option valuation and,
549–552, 578–579
risks of, 695–696
Arbitrage pricing theory (APT), 207–208
capital asset pricing model versus, 208
defined, 207
Fama-French three-factor model and,
208–210, 333n
Arcelor, 834–835
Archimedes, 548n
Archipelago, 77n
Argentina, default on debt, 67–68, 602n
Arithmetic averages, risk and, 164–165
Arizona Public Service Co., 396