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Essentially there are three types of competitive bids or price quotes: fixed price bids, cost‐plus markup bids, and incentive (risk‐sharing) bids. An “Expected Present Value” (EPV) model of competitive bidding is presented which establishes the requirements for the maximisation of the firm's expected present value of net worth. Reconciliation of the EPVC and the markup procedure allows an examination of the issues that must be considered in order that the firm's bid prices and quotes best serve the objective of net worth maximisation when information search costs are expected to be prohibitive. Observations suggest that firms do not attempt to maximise their net worth, preferring instead to pursue target rates of capacity utilisation and profitability. Therefore the EPVC model does not explain or predict the behaviour of all bidding firms. A behavioural model is suggested, based on the positive starting point of business practice. This enables firms to do what they do better. Based on what they already do, it holds few surprises or complexities and requires little information on complex issues and so obviates the need for substantial expenditure on search costs.

The paper proposes using modified duration in calculating the proper risk-adjusted discount rate (RADR) to account for downside risk scenarios in capital budgeting.

The paper shows how to use modified duration to summarize in a single number the bidimensional information about the inflows and terms in which they are charged in the use of the RADR. If a short modified duration characterizes the project, that is, the most relevant inflows are charged in short times, then discounting at RADR has mild effects on net present value (NPV). Else, if a long modified duration characterizes the project, discounting at RADR may have severe effects on NPV. The study proves that RADR's effectiveness increases with the project's modified duration.

The study builds a bridge between the regular NPV method used in academia and the RADR method used in the managerial context by identifying the proper RADR that leads the same NPV risk-adjustments, whichever method is used by including modified duration into the analysis.

The results show how to select the proper RADR by reducing the subjectivity and increasing financial precision based on modified duration, thus providing an alternative to the norm. Simulations are used to make sensitivity analysis more effective and spotlight the main drivers in the risk-adjustments providing robust results.

This paper fulfils the gap between the RADR method and the expected net present value method by providing simple relations between the characteristic parameters.

This paper aims to illustrate the viability of distressed mergers and acquisitions (M&A) by way of case study utilizing the modern Graham and Dodd valuation approach.

The paper presents a distressed acquisition case study of the 1996 Marvel Entertainment Group (Marvel) bankruptcy. It draws on previously published Graham and Dodd methodological materials as well as a financial case study of Marvel that was prepared at the time. The valuation presented in this paper is the sole work of the author.

The case study supports the view that distressed M&A can be a viable corporate strategy alternative. It also demonstrates how a multi‐layered valuation approach such as Graham and Dodd can be ideal for identifying value that may be hidden in the confusion and distress of bankruptcy.

The case study illustrates the valuation insights that the modern Graham and Dodd approach can produce in a distressed setting.

The case study illustrates the viability of distressed M&A as a corporate strategy alternative.

This is the first paper that we are aware that applies Graham and Dodd‐based distressed M&A valuation to corporate strategy.

This paper aims to illustrates the use of the modern Graham and Dodd valuation methodology as a corporate M&A tool by way of case study.

The paper presents a case study of the 1995 Berkshire Hathaway acquisition of GEICO and draws on previously published Graham and Dodd methodological materials as well as GEICO's publicly available financial information. The valuation presented in the case is the sole work of the authors.

The paper finds that, while Graham and Dodd‐based valuation is a popular investment methodology it has thus far received scant attention as a corporate M&A tool. The results of the GEICO case suggest that Graham and Dodd valuation could be applied successfully to corporate M&A.

The paper explains modern Graham and Dodd valuation in the context of Berkshire Hathaway's 1995 GEICO acquisition. It demonstrates how that acquisition contained a reasonable margin‐of safety, or price discount to estimated intrinsic value, even though it was taken private at a 25.6 percent premium over the $55.75/share market price at the time. The case demonstrates the practical utility of Graham and Dodd‐based valuation in corporate M&A, and provides recommendations for its use in that context.

While Graham and Dodd valuation has been well covered from an investment perspective this is the first work, as far as the authors are aware, that seeks to apply it to corporate M&A.

This study aims to understand how consumers evaluate downscale vertical line extensions of a prestige/luxury original equipment manufacturer (OEM) in the European automotive market. The authors investigate the moderator effects of innovativeness and the need-for-status traits on the relationships between consumers' extension perceived fit (EPF), extension attitude (EA) and extension perceived value (EPV).

Experimental design with quantitative analyses based on a sample of 419 participants. Participants were randomly assigned to two treatments: low-fit and high-fit extension simulations.

The purchase intention of the downscale vertical extension of a luxury OEM brand is directly influenced by EPV and indirectly influenced by consumer EA and EPF with the parent brand. Findings also suggest that parent brand equity is transferable to extensions that present closeness and consistency with the brand’s heritage. Moreover, the need for status strengthens the relationship between the EPF and the extension perceived social value (EPSV).

The authors developed a realistic simulation of a downscale model of a well-known prestige/luxury car brand. The authors test the influence of innovativeness and need-for-status personal traits on consumer extension acceptance.

This paper introduces the base‐case‐valuation pattern, which is derived from the modern Graham and Dodd valuation methodology, and it demonstrates how that pattern could be utilized in M&A by way of a case study.

The paper presents a case study of the 2004 acquisition of Sears by hedge‐fund manager Eddie Lampert. It draws on previously published Graham and Dodd methodological materials as well as Sears' publicly available financial information. The valuation calculations presented in the case is the sole work of the author.

The results of the case suggest that base‐case valuation could be practically utilized in M&A. Significantly, it could also be utilized in the formulation of an M&A‐negotiating strategy, shareholder‐communication plan, and performance‐improvement plan.

The paper demonstrates how that acquisition contained a reasonable margin‐of safety, or price discount to estimated value, even though it occurred at a multiple of 1.8x Sears' book value at the time.

This case demonstrates the practical utility of base‐case value in M&A by way of the 2004 Sears acquisition.

This work introduces the base‐case‐valuation pattern, and it is the first work, as far as we are aware, that applies the Graham and Dodd methodology to the Sears acquisition even though Eddie Lampert is a noted Graham and Dodd‐based practitioner.

The purpose of this paper is to assess the value and risks of Disney's 2009 $4 billion acquisition of the Marvel Entertainment Group (Marvel) in a case study utilizing the modern Graham and Dodd valuation approach.

The paper presents a detailed valuation of Marvel in 2009 drawing on previously published Graham and Dodd methodological materials and Marvel's publicly available financial reports.

Disney's $4 billion acquisition price for Marvel contained considerable risks based on certain valuation assumptions, which were identified in the context of our analysis.

This acquisition is a useful one for executives to study because it involves a situation many of them could face: evaluating the purchase of a great company that is seemingly a strategic fit and offered at what appears to be a reasonable price. Assessing such opportunities utilizing the modern Graham and Dodd valuation approach facilitates greater levels of insight into key assumptions, value drivers, and risks.

This is a methodology that has proved useful to successful value investors over time.

Lessons executives in many industries can learn from a Graham and Dodd‐based valuation of the 2009 Disney acquisition of Marvel include: better risk assessment, valuation of entertainment property assets and franchise assessment.

This study aims to examine the impact of five consumption values (i.e. ecological, functional, symbolic, experiential and epistemic) on consumers’ intentions to adopt green products. Using Thaler’s utility theory, the authors investigate the indirect effect of values on purchase intention through acquisition utility and transaction utility. Two moderators (materialism orientation and value consciousness) further influence the strength of the effect of consumption values on transaction utility.

The authors used a survey design (N = 437 Chinese customers recruited through a Chinese online panel provider) and structural equation modeling (SEM) to test six hypothesized relationships in the proposed model. Moderated SEM was used for moderation analysis.

Most hypothesized relationships in the model were confirmed, with the exception of the functional value–transaction utility link and the moderating effect of materialism on the experiential value–transaction utility relationship.

Larger-scale research may help to determine whether there are more significant differences in consumer evaluations of different types of green products.

As the concept of green marketing in China evolves, firms should continue to stress the importance and value of green products regarding individuals’ care for the environment, status and self-image. Further, firms should conduct systematic utility analyses and address acquisition and price equity in a strategic process.

To the best of the authors’ knowledge, this study is the first to adapt utility theory to green consumption and proposes a clearly defined and well-substantiated set of utility types by merging economic and green consumption literature.

This paper seeks to propose a definition of strategic mergers and acquisitions (M&A) that is illustrated by way of case study. It also aims to introduce the strategic concept of “nascent franchise.”

The proposed definition is based on existing strategic theory, which was extended to the field of M&A. The supporting case analysis is based on the Berkshire Hathaway‐led acquisition of MidAmerican Energy Holdings Company (“MidAmerican”) in 1999, and was prepared from publicly available financial information.

Defining strategic M&A in the manner proposed in this paper proved useful in explaining the dynamics of, and post‐acquisition performance of, the MidAmerican acquisition. It also helped to frame the analysis leading to the concept of nascent franchise.

The paper's definition of strategic M&A could help reframe deal deliberations for practitioners, and spur research by strategy scholars. Additionally, the concept of “nascent franchise” could be developed in future research conducted by either practitioners or academicians.

Strategic M&A is defined in a manner consistent with the literature, but extended and illustrated in a unique manner. The valuation presented in this paper, and the concept of nascent franchise derived from the valuation, are based solely on the author's work.

Financial information about costs and return on investments are of key importance to strategic decision making but also in the context of process improvement or business engineering. The purpose of this paper is to propose a value‐oriented approach to business process modeling based on key concepts and metrics from operations and financial management, to aid decision making in process re‐design projects on the basis of process models.

The paper suggests a theoretically founded extension to current process modeling approaches, and delineates a framework as well as methodical support to incorporate financial information into process re‐design. The paper uses two case studies to evaluate the suggested approach.

Based on two case studies, the paper shows that the value‐oriented process modeling approach facilitates and improves managerial decision making in the context of process re‐design.

The paper presents design work and two case studies. More research is needed to more thoroughly evaluate the presented approach in a variety of real‐life process modeling settings.

The paper shows how the approach enables decision makers to make investment decisions in process re‐design projects, and also how other decisions, for instance in the context of enterprise architecture design, can be facilitated.

This paper reports on an attempt to integrate financial considerations into the act of process modeling, in order to provide more comprehensive decision‐making support in process re‐design projects.