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Course: CH 304k, Spring 2008School: University of Texas
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University of Texas - CH - 304k
Periodic table rows 1-4 plus Rb, Sr, Zr, Ru, Pd, Ag, Cd, Sn, Sb, Te, I, Xe plus Cs, Ba, Pt, Au, Hg, Pb, Rn plus Nd, U, Pu, Cm, Es1: H = hydrogen; He = helium 2: Li = lithium; Be = beryllium; B = boron; C = carbon; N = nitrogen; O = oxygen; F = fluo
University of Texas - FIN - 374C
Chapter 15 Capital Structure Decisions: Part IANSWERS TO BEGINNING-OF-CHAPTER QUESTIONSPreface to Answers: Students often regard capital structure as being the most difficult topic covered in this text. The empirical evidence on the effects of capi
University of Texas - FIN - 374C
Chapter 26 Mergers, LBOs, Divestitures, and Holding CompaniesANSWERS TO BEGINNING-OF-CHAPTER QUESTIONSThe BOC questions lead us through a verbal discussion of mergers and merger analysis. This is a useful exercise, but it does not explain the type
University of Texas - FIN - 374C
Chapter 13 Capital Budgeting: Estimating Cash Flows and Analyzing RiskANSWERS TO BEGINNING-OF-CHAPTER QUESTIONS13-1The firm's FCFs reflect both its past and current investments. Past investments produce current FCFs, but current investments are
University of Texas - FIN - 374C
CHAPTER 9Financial Planning and Forecasting Pro Forma Financial Statements1Topics in Chapter Financial planning Additional Funds Needed (AFN) formula Pro forma financial statementsSales forecasts Percent of sales method2Financial Pla
University of Texas - FIN - 374C
Chapter 16Capital Structure Decisions: Part II1Topics in Chapter MM and Miller models Hamada's equation Financial distress and agency costs Trade-off models Asymmetric information theory2Who are Modigliani and Miller (MM)?They
University of Texas - FIN - 374C
CHAPTER 11Corporate Value and Value-Based Management1Topics in Chapter Corporate Valuation Value-Based Management Corporate Governance2Corporate Valuation: A company owns two types of assets. Assets-in-place Financial, or nonoperating
University of Texas - FIN - 374C
CHAPTER 20Hybrid Financing: Preferred Stock, Warrants, and Convertibles1Topics in ChapterTypes of hybrid securitiesPreferred stock Warrants Convertibles Features and risk Cost of capital to issuers2How does preferred stock diffe
University of Texas - FIN - 374C
Chapter 1An Overview of Financial Management1Topics in Chapter Basic Goal: to create shareholder value Agency relationships:Stockholders versus managers Stockholders versus creditors Transparency in financial reporting Market interes
University of Texas - CH - 304k
Exams Exam1 Exam2 Exam3 Exam4 Exam5 Final HW HW1 HW2 HW3 HW4 HW5 HW6 HW7 HW8 HW9 HW10 HW11Raw Grade 200 152 152 196 200 0 18.83 30.67 34.11 25.38 25.78 25.93 19.17 29.17 21.5 0 57.62 (^edit this column)Weighted %Exam weight 1.883 3.067 3.411 2.
University of Texas - MKT - 337
August 21, 20071Marketing 337 Principles of Marketing Fall 2007 Instructor: Office Hrs: Office: e-mail: Class: TA: Prof. Leigh McAlister Ed and Molly Smith Chair of Business Administration M/W 3:30 5:00 and by appointment CBA 7.228 leigh.mcalist
University of Texas - MKT - 337
Extra Credit for MKT 337 and MKT 337H Marketing Department Subject Pool:Sign-up online at: http:/mccombs.sona-systems.com/ Studies end by Friday November 30th, 2007Marketing data and theories depend upon the research methods used to obtain them. Th
University of Texas - FIN - 367
http:/www.aaii.com/ (American Institute of Individual Investors, lots of investing tools and educational material, e.g., http:/www.aaii.com/basics/index.cfm but some are for members only) http:/www.marketwatch.com (good source for general market info
University of Texas - FIN - 367
Morningstar.comAnother Look at a Wide-Moat Put-Writing OpportunityWednesday April 23, 7:00 am ETBy Philip Guziec At Morningstar, we are currently developing a methodology that can be used to combine fundamental research with options investing. O
University of Texas - FIN - 367
The Intrade.com political futures trade in a price range from zero to 100. For example, as of this writing, the contract on Barack Obama being the Democratic nominee is trading at about 57. After the Democratic National Convention in August, if it tu
University of Texas - FIN - 367
MARK HULBERTSize does matterBy Mark Hulbert, CBS.MarketWatch.com Last Update: 12:05 AM ET Feb. 24, 2004 ANNANDALE, Va. (CBS.MW) - I realize that this headline may trigger every spam filter in the world. But I am not focusing on what those filters
University of Texas - FIN - 367
'Lazy Portfolios' update: good news 8 winners in bull and bear markets, best strategy for passive investors By Paul B. Farrell, MarketWatch Last update: 1:22 p.m. EDT April 8, 2008 ARROYO GRANDE, Calif. (MarketWatch) - Now for the good news from the
University of Texas - FIN - 367
A Random Walk Down Wall Street by Burton Malkiel is a solid and wide-ranging survey of finance that's as good a place to start as any (even though it's somewhat skeptical about the value of fundamental analysis) Jeremy Siegel's Stocks for the Long Ru
University of Texas - FIN - 367
Chapter 14 Options MarketsPayoffs and Profits on Options at Expiration - CallsNotation Stock Price = ST Exercise Price = X Payoff to Call Holder (ST - X) if ST >X 0 if ST < XProfit to Call Holder Payoff - Purchase Price.Payoffs and Profits on
University of Texas - FIN - 367
Single Factor ModelRi = E(Ri) + iF + e i = index of a securities' particular return to the factor F= some macro factor; in this case F is unanticipated movement; F is commonly related to security returns Assumption: a broad market index like the S&P
University of Texas - FIN - 367
Chapter 12 Equity Valuation.Dividend Discount Models: General ModelVotDt t k) 1 (1 V0 = Value of Stock Dt = Dividend k = required return Present value of all expected future dividends.Why just dividends?V0D D (1 k ) (1 k )1 2 1
University of Texas - FIN - 367
35.0030.0025.0020.0015.00Series210.005.000.00 -60.00 -40.00 -20.00 -5.00 0.00 20.00 40.00 60.00-10.00200.00150.00100.0050.000.00 -60.00 -40.00 -20.00 0.00 20.00 40.00 60.00-50.00-100.00Year Small Stocks 1926 -8.91 192
University of Texas - FIN - 367
35.0030.0025.0020.0015.00Series210.005.000.00 -60.00 -40.00 -20.00 -5.00 0.00 20.00 40.00 60.00-10.00200.00150.00100.0050.000.00 -60.00 -40.00 -20.00 0.00 20.00 40.00 60.00-50.00-100.00Year Small Stocks 1926 -8.91 192
University of Texas - FIN - 367
Chapter 15 Options ValuationOption Values Intrinsic value - profit that could be made if the option was immediately exercised Call: stock price - exercise price Put: exercise price - stock price Time value - the difference between the option p
University of Texas - FIN - 367
Finance 367 Professor Bing Han Spring 2008 Data Analysis #2The data you need to do this problem set is contained in an Excel file named DataPS1.xls which contains the series of historical holding period returns in the text in Table 5.3. (for your c
University of Texas - FIN - 367
Chapter 7 Capital Asset Pricing Theory (CAPM)Capital Asset Pricing Model (CAPM) Equilibrium model that underlies all modern financial theory Derived using principles of diversification with simplified assumptions Markowitz, Sharpe, Lintner and M
University of Texas - FIN - 367
Brief Introduction Options MarketsOption Terminology Buy - Long Sell - Short Call: the right to buy Put: the right to sell Key Elements Exercise or Strike Price Premium or Price Maturity or Expiration.Market and Exercise Price Relationsh
University of Texas - FIN - 367
Suggested Solutions to Chap 10 Exercises Fin 367 Spring 2008 Professor Bing HanChapter 10:1.The percentage bond price change is: Durationy 1 y7.1940.0050 1.100.0327 or a 3.27% decline2.Computation of duration: a. YTM = 6% (1) (2) Ti
University of Texas - FIN - 367
Suggested Solutions to Chap 9 Exercises Fin 367 Spring 2008 Professor Bing HanChapter 9: 4. The bond price will be lower. As time passes, the bond price, which is now above par value, will approach par. If the yield curve is upward sloping, you cann
University of Texas - FIN - 367
Suggested Solutions to Chap 8 Exercises Fin 367 Spring 2008 Professor Bing HanChapter 8: 4. c. This is a classic filter rule, which would appear to contradict the weak form of the efficient market hypothesis. The P/E ratio is public information so t
University of Texas - FIN - 367
Chapter 8 Selected Problems: From textbooks1, P269 #4 2, P270 #7 3, P270 #9 4, P271 #17Additional multiple choice questions:1. The weak form EMH states that _ must be reflected in the stock price. A) all market trading data B) all publicly avail
University of Texas - FIN - 367
Chapter 7 Selected Problems: From textbooks1, P234 #1 2, P234 #7 3, P235 #10 4, P236 #19Additional multiple choice questions: 1. According to the capital asset pricing model, a well-diversified portfolio's rate of return is a function of _. A) mar
University of Texas - FIN - 367
Suggested Solutions to Selected Problems for Chap 6 Fin 367 Spring 2008 Professor Bing HanChapter 6:3. a. The mean return should be equal to the value computed in the spreadsheet. The fund's return is 3% lower in a recession, but 3% higher in a boo
University of Texas - FIN - 367
Suggested Solutions to Selected Problems Chap 5 Fin 367 Spring 2008 Professor Bing HanChapter 5:4.E(r) = [0.3244%] + [0.414%] + [0.3(16%)] = 14% (16 14)2] = 540= [0.3(44 14)2] +[0 .4(14 14)2] + [0.3= 23.24% The mean is unchange
University of Texas - FIN - 367
Chapter 5 Selected Problems: From textbooks1, P154 #4 2, P154 #5 3, P157 #19Additional multiple choice questions:1. The holding period return on a stock is equal to _. A) the capital gain yield over the period plus the inflation rate B) the capi
University of Texas - FIN - 367
Finance 367 Spring 2008 Exam 3 (Practice)Your Name_, Last_ FirstYour Student ID number _Notes: 1, The total is 25 points. 2, Problems 1 through 16 are multiple choices. Each correct answer gives you 1 point. 2, For Short Essay and Calculati
University of Texas - FIN - 367
Finance 367 Spring 2008 Exam 2 (Practice) SolutionMultiple Choices:1. Historical records regarding returns on stocks, Treasury bonds, and Treasury bills between 1926 and 1998 show that _A_. A) stocks offered investors greater rates of return than
University of Texas - FIN - 367
Finance 367 Spring 2008 Exam 2 (Practice)Multiple Choices:1. Historical records regarding returns on stocks, Treasury bonds, and Treasury bills between 1926 and 1998 show that _. A) stocks offered investors greater rates of return than bonds and b
University of Texas - FIN - 367
Answers are on the next page 1. An American put option gives its holder the right to _. A) buy the underlying asset at the exercise price on or before the expiration date B) buy the underlying asset at the exercise price only at the expiration date C
University of Texas - FIN - 367
Chapter 3 and Chapter 4 Problems: From textbooks 1, P92 #7 2, P93 #12 3, P123 #8 4, P123 #10Additional multiple choice questions:1._ is called the Big Board. A) The American Stock Exchange B) The New York Stock Exchange C) The Pacific Stock Excha
University of Texas - FIN - 367
Finance 367 Professor Bing Han Spring 2008 Data Analysis #1The data you need to do this problem set is contained in an Excel file named DataPS1.xls which contains the series of historical holding period returns in the text in Table 5.3 (for your co
University of Texas - FIN - 367
Finance 367 Spring 2008 Exam 1 (practice)Multiple Choices:1. Which of the following is not a money market instrument? _ A) treasury bill B) commercial paper C) preferred stock D) banker's acceptance2._ is not a characteristic of a money market
University of Texas - FIN - 367
Suggested Solutions to Exercises #1 Chap 1-2 Fin 367 Spring 2008 Professor Bing HanSolution to #1 on P23 a. Cash is a financial asset because it is the liability of the federalgovernment. b. No. The cash does not directly add to the productive ca
University of Texas - FIN - 367
35.0030.0025.0020.0015.00Series210.005.000.00 -60.00 -40.00 -20.00 -5.00 0.00 20.00 40.00 60.00-10.00200.00150.00100.0050.000.00 -60.00 -40.00 -20.00 0.00 20.00 40.00 60.00-50.00-100.00Finance 367 Spring 2008: Answer
University of Texas - FIN - 367
Margin trading and short selling ExamplesStock Margin Trading Maximum margin is currently 50%; you can borrow up to 50% of the stock value Set by the Fed Maintenance margin: minimum amount equity in trading can be before additional funds must be
University of Texas - FIN - 367
Chapter 10 Selected Problems: From textbooks1, P346 #1 2, P346 #2 3, P346 #7 4, P347 #11Additional multiple choice questions:1. All other things equal, which of the following has the longest duration? A) a 30 year bond with a 10% coupon B) a 20 y
University of Texas - FIN - 367
Suggested Solutions to Selected Chap 7 problems Fin 367 Spring 2008 Professor Bing HanChapter 7: 1. 7. a, c and d. a. The beta is the sensitivity of the stock's return to the market return. Call A the aggressive stock and D the defensive stock. Then
University of Texas - FIN - 367
Chapter 6 Selected Problems: From textbooks1, P191 #3 2, P193 #6 3, P193 #7 4, P193 #9Additional multiple choice questions:1. Risk that can be eliminated through diversification is called _ risk. A) unique B) firm-specific C) diversifiable D) all
University of Texas - FIN - 367
Finance 367 Spring 2008 Practice Exam 1 (Solution)Multiple Choices:1. Which of the following is not a money market instrument? _C_ A) treasury bill B) commercial paper C) preferred stock D) banker's acceptance2._D_ is not a characteristic of a
University of Texas - FIN - 367
Finance 367 Spring 2008 Exam 3 (Practice)Your Name_, Last_ FirstYour Student ID number _Notes: 1, The total is 25 points. 2, Problems 1 through 16 are multiple choices. Each correct answer gives you 1 point. 2, For Short Essay and Calculati
University of Texas - FIN - 367
Suggested Solutions to Selected Problems Chap 3-4 Fin 367 Spring 2008 Professor Bing HanSolution to Chap3 problems 7. a. You buy 200 shares of Telecom for $10,000 (you invest $5000, and borrow another $5000). These shares increase in value by 10%, o
University of Texas - FIN - 367
Chapter 1 and Chapter 2 Problems: From textbooks 1, P23 #1 2, P23 #4 3, P55 #1 4, P55 #6Additional multiple choice questions:1. Asset allocation refers to the _. A) allocation of the investment portfolio across broad asset classes B) analysis of
University of Texas - FIN - 374C
Chapter 11 Corporate Value and Value-Based ManagementANSWERS TO BEGINNING-OF-CHAPTER QUESTIONS11-1Operating assets include cash required for liquidity purposes, inventories, receivables, and fixed assets necessary to operate a business, while no
University of Texas - FIN - 374C
Chapter 25 Bankruptcy, Reorganization, and LiquidationANSWERS TO BEGINNING-OF-CHAPTER QUESTIONS25-1 Bankruptcies occur in firms of all sizes. Small firms, with fewer creditors, are often able to work out informal settlements and thus avoid the time
University of Texas - FIN - 374C
Chapter 16 Capital Structure Decisions: Part IIANSWERS TO BEGINNING-OF-CHAPTER QUESTIONS16-1Arbitrage is generally thought of as the process of buying an item in one market and simultaneously selling it at a higher price in another market and th
University of Texas - FIN - 374C
CHAPTER 13Capital Budgeting: Estimating Cash Flows and Analyzing Risk1Estimating cash flows:Relevant cash flows Working capital treatment InflationRisk Analysis: Sensitivity Analysis, Scenario Analysis, and Simulation Analysis2Pro
University of Texas - FIN - 374C
CHAPTER 17Distributions to Shareholders: Dividends and Repurchases1Topics in Chapter Theories of investor preferences Signaling effects Residual model Stock repurchases Stock dividends and stock splits Dividend reinvestment plans2What
University of Texas - FIN - 374C
CHAPTER 18Initial Public Offerings, Investment Banking, and Financial Restructuring1Topics in Chapter Initial Public Offerings Investment Banking and Regulation The Maturity Structure of Debt Refunding Operations The Risk Structure of Deb
University of Texas - FIN - 374C
FIN 374C / Spring 2008 / Prof. Liz GoldreyerFINANCIAL PLANNING AND POLICY FOR LARGE CORPORATIONS (FIN 374C)SYLLABUS, SPRING 2008 Information about the course will be posted throughout the semester on Blackboard. Instructor Dr. Liz Goldreyer Office
University of Texas - FIN - 374C
CHAPTER 10Determining the Cost of Capital1Topics in ChapterCost of Capital ComponentsDebt Preferred Common EquityWACC2What types of long-term capital do firms use? Long-term debt Preferred stock Common equity3Capital Com
University of Texas - FIN - 374C
M&A Tax Implications Example Given: $50M Purchase Price $30M BV of target's assets 40M appraised value of target's assets 35% Corp. tax rate Target has no debt What is implications to: 1) target shareholders 2) post-merger asset values 3) taxes to po