PROJECT GUIDANCE

ORIENTATION PROGRAMME (2011-2012)

RULES FOR PROJECT GUIDANCE

Each students should report to their respective project guide . Attending to project guidance classes every week is mandatory otherwise each student must submit letter from parents/guardian or else should meet Father or Director invariably. Attendance will be monitored. A book shall be maintained by every guide in which every detail regarding students and also about the project updates to be disclosed relating to project.

 Chapter wise verification is a must. Before the preliminary presentation , the students should submit 2 hard copies and one soft copy in CD to their concerned guide without which they will not be allowed to do project presentation. the letter of consent from the company to be submitted to the respective guides last by 25th august,2011.

PROJECT GUIDELINES
The project guidelines are reflected in the ready recknor distributed to you . Refer to those guideline or else a copy of detailed project guidelines is available in the library for quick reference. An other option is to browse through the OU website www.ou-mba.ac.in

LITERATURE SURVEY)
Every student should go through the Literature for their particular topic which will be a part of their Chapter 1 . This can be done by going through articles from the Journals , Magazines, other research work done on the same topics.

LITERATURE SURVEY
For example : Topic :Capital Budgeting

American Journal of Business Education (AJBE)

American Journal of Business Education July 2011 Volume 4, Number 7 2011 The Clute Institute 29 Topics In Finance Part VI Capital Budgeting Judy Laux, Colorado College, USA ABSTRACT This series on the theory of financial management offers insight into the roles of stockholder wealth maximization, the risk-return tradeoff, and agency conflicts as they apply to major topics in finance. The current article investigates capital budgeting. Much literature addresses this topic, with a number of articles challenging mainstream theories, some investigating agency problems, and a few empirically testing the relationships taught in most managerial finance classrooms. Keywords: capital budgeting; agency theory; stockholder wealth maximization; discounted cash flows

The question to be answered are: Why is capital budgeting important? What approaches to capital budgeting exist? What theories prevail? What agency conflicts do financial managers face? What aspects of capital budgeting have researchers investigated, and what are their findings? What questions should offer direction to the financial manager for making good capital budgeting decisions?

HOW TO REFLECT IN YOUR PROJECT:

CAPITAL BUDGETING IN THE LITERATURE The capital budgeting literature is vast, but several articles since 2000 give a good idea of how researchers have treated some of the ideas presented in the current paper. This section groups those articles into two categories: Capital budgeting approaches and principalagent challenges.

CAPITAL BUDGETING IN THE LITERATURE

Capital Budgeting Models While some researchers focus on the cost of capital input into the discounted cash flow (DCF) capital budgeting models, others debate the relative strength of the different models themselves. Because the estimation of American Journal of Business Education July 2011 Volume 4, Number 7 2011 The Clute Institute 33

 the cost of capital determines project acceptability in the DCF models, mistaken estimations can cause poor accept-reject decisions. The Capital Asset Pricing Model (CAPM) takes center stage in the literature as one technique for estimating the cost of the equity component of the weighted average cost of capital, but the model has received much criticism over the past decades [See Laux, 2010 (d) and Laux 2011 for coverage of some of this literature.] In Toward an Implied Cost of Capital, Gebhardt, Lee, and Swaminathan [2001] offer a model to the financial manager for approximating the firms cost of capital. The authors suggest that a firms cost of capital is a function of its industry membership, B/M ratio, forecasted long-term growth rate, and the dispersion in analyst earnings forecasts (p. 135). Jagannathan and Meier [2002] question whether we even need CAPM for capital budgeting, contending that capital rationing exists to such an extent that misestimates of the WACC based on CAPM dont really mattermost projects actually undertaken have internal rates of return in excess of that measure anyway.

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