Tesla Case Analysis:

Please use a couple of concise and directed sentences to type your responses to each of the following questions:

Please review the financial economic profit calculation you completed in the Week 2 Practice Set to answer the next four questions (my CHeck math on Tesla might not be correct (total market value of equity):

1.Please comment on the trend in Teslas operating income over the past five years.

2. Please remember that Beta is a measure of risk that consequently drives the cost of equity number and the weighted average cost of capital. Please review Teslas beta and comment on whether you believe this to be an accurate representation of Teslas risk.

3.Review the market weights of debt and equity for Tesla relative to the others in the industry. Is this level of debt too high, too low, or misrepresented? Why?

4.Review Teslas economic profit trend for the past five years. Is this trending in the right direction, too high, too low, misrepresented because of some factor? How or why?

5.Remember that strengths are internal to the firm and are things that allow positive net present value enhancing projects in the future. What do you believe to be Teslas biggest internal strength? Why?

Tesla's Balance Sheet: \begin{tabular}{lrrrrrrrrrrrr} \cline { 2 - 10 } Year & & 2016 & 2017 & 2018 & 2019 & 2020 & 2021 & 2022 \\ \hline Total Assets & $ & 22,664 & $ & 28,655 & $ & 29,740 & $ & 34,309 & $ & 52,148 & $62,131 & $82,338 \\ \hline Operating Liabilities & $ & 2,917 & $ & 3,715 & $ & 4,777 & $ & 5,862 & $ & 8,865 & $14,328 & $20,808 \\ \hline Net Operating Assets & $ & 19,747 & $ & 24,940 & $ & 24,963 & $ & 28,447 & $ & 43,283 & $47,803 & $61,530 \end{tabular} Tesla's Balance Sheet: \begin{tabular}{lrrrrrrrrrrrr} \cline { 2 - 10 } Year & & 2016 & 2017 & 2018 & 2019 & 2020 & 2021 & 2022 \\ \hline Total Assets & $ & 22,664 & $ & 28,655 & $ & 29,740 & $ & 34,309 & $ & 52,148 & $62,131 & $82,338 \\ \hline Operating Liabilities & $ & 2,917 & $ & 3,715 & $ & 4,777 & $ & 5,862 & $ & 8,865 & $14,328 & $20,808 \\ \hline Net Operating Assets & $ & 19,747 & $ & 24,940 & $ & 24,963 & $ & 28,447 & $ & 43,283 & $47,803 & $61,530 \end{tabular}