Q_A on the Midterm

Q_A on the Midterm - HAAS SCHOOL OF BUSINESS UNIVERSITY OF...

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H AAS S CHOOL OF B USINESS U NIVERSITY OF C ALIFORNIA AT B ERKELEY UGBA 103 A VINASH V ERMA Q&A ON THE M IDTERM I reproduce below the questions I received from you until 11 AM, on July 25, 2009. My answers follow. I will answer the next set of questions sometime tomorrow. Q: I am looking at question 7 on the midterm, and I'm not quite sure what the information regarding Stock A and Stock B have anything to do with the pricing of a risk-free zero coupon bond. Do we need to assume that the yield of the ZCB is equal to the risk of a portfolio of the two stocks? A: You are given that the ZCB is risk free. Q: Problems 1 and 2: Do we use straight line depreciation. Also is there any salvage value? A: You are given the cash flows that you need to answer the question. If you wish, you can assume that depreciation and salvage value have already been taken into account in the cash flows that you are given. Q:
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This note was uploaded on 04/30/2010 for the course L&S 101 taught by Professor Chow during the Spring '10 term at Berkeley.

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Q_A on the Midterm - HAAS SCHOOL OF BUSINESS UNIVERSITY OF...

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