Master Formula Sheet
Exam #1: Formulas #1-#21
Exam #2: Formulas #1-#29
Exam #3: Formulas #1-#34
Exam #4: Formulas #1-#38
1.
2.
CF
1
CF
1
1
1
(1 + r)
N
r
(1 + r)
N
r
1
3.
CF
1
r-g
if r > g
4.
CF1
r -g
1 CFN+1 =
N
(1 + r) r g
1 + g N
CF1
1 -
r -

Section #6
Capital Structure Case Analysis:
The Bullseye Corporation
October 14th, 2010
Copyright 2010 by Rich Curtis
The Bullseye Corporation
A. Valuing The Common Stock Of The Unlevered Firm
(See Bullseye Case, pp. 1-2)
1. Assume that the Bullseye Corp

Solutions Manual
Fundamentals of Corporate Finance 9th edition Ross, Westerfield, and Jordan Updated 12-18-2009
CHAPTER 1 INTRODUCTION TO CORPORATE FINANCE
Answers to Concepts Review and Critical Thinking Questions 1. Capital budgeting (deciding whether t

Econ Prelim 2 Notes Keynesian Economics
Keynes rejection of Neoclassical-Pre-k Neoclassical Macro
In Pre-K model, equilibrium interest rate depends on savings and investment where savings depends on
equilibrium output.

Chapter 9
NPV and Other
Investment Criteria
Good Decision Criteria
We need to ask ourselves the
following questions when evaluating
capital budgeting decision rules
Does the decision rule adjust for the
time value of money?
Does the decision rule adjus

Chapter 8
Stock Valuation
How big?
The 30 stocks of the DJIA account for $2.34T
(2/24/09), down from $3.6T (9/29/2008).
The largest stock is Exxon Mobil at $350
($409B) in market cap, followed by Wal-Mart
at $194B ($237B), Microsoft at $152B
($245B), Jo

Chapter 7
Interest Rates and
Bond Valuation
How big? Over $33T
Source: SIFMA http:/apps.finra.org/investor_information/smart/bonds/401000.asp
Government Bonds
Treasury Securities
Federal government debtno default risk
T-bills (<2 years); T-notes (2-10

Chapter 6
Discounted Cash
Flow Valuation
using M ultiple Cash
Flows
Example of Multiple Cash Flows
You are considering an investment that will pay
you $1000 per year for 3 years. If you want to earn
10% on your money, how much would you be
willing to pay

Chapter 5
I ntroduction to
V aluation: The Time
V alue of M oney
Basic Definitions
Present Value todays value of money you
expect to receive in the future. (Would you rather
have $80 right now instead of $100 a year from
now?) E.g. signing bonuses
Futur

Chapters 2 and 3
Financial Statements,
Taxes and Cash Flows
The Balance Sheet - Figure
2.1
The balance sheet is a snapshot of the firms assets
and liabilities at a given point in time
Balance Sheet Identity:
Assets = Liabilities + Stockholders Equity
Bala

Chapter 1
Introduction to
Corporate Finance
Key Concepts and Skills
Know the basic types of financial
management decisions and the role of the
financial manager
Know the goal of financial management
Understand the conflicts of interest that can
arise b

Section #11
Options and Convertibles
November 10th, 2010
1. Macrosoft:
Option
and NY
Close
acrosoft
114
114
114
114
Strike
Price
Expiration
Call Vol.
Call Last
Put Vol.
Put Last
110
110
110
110
Feb
Mar
May
Aug
85
61
22
3
7.60
8.80
10.25
13.05
40
22
11
3
.

Chapter 10
Making Capital
Investment Decisions
Relevant Cash Flows
The cash flows that should be
included in a capital budgeting
analysis are those that will only occur
if the project is accepted
These cash flows are called
incremental cash flows
The s

Section #4 Solutions
Breakeven Analysis and Operating Leverage
September 22nd, 2010
1. Net Income and Operating Cash Flow With Taxes
a. Write an expression for net income in terms of quantity sold,
price, variable cost, fixed cost, depreciation, and the
c

AEM 3240 Section #3
Stock Valuation
September 14th, 2010
Copyright 2010 by Rich Curtis
What is the value of any asset derived from?
Common Stock Valuation
1. Based on Discounted Cash Flows
a. What cash flows?
b. What discount rate?
2. Based on Multiples

Section #1 Solutions
Time Value Exercises
August 31st, 2010
Copyright 2010 by Rich Curtis
1. Michelle and The Time Value of Money
a. After agents fees and taxes, Michelle will have $5.28 M:
$10 M - Agent's Fees - Tax
= $10 M - .04($10 M)
= $10 M - .04($10

Solution simulated 1st prelim 09292009
<The actual exams are clearer and easier than the simulated exams, as what is supposed to be>
(1) President Reagans tax cutting program had two components
a) The predictive part: Reduced tax revenue leads to reduced

A sketch of the answer to the 2nd prelim, last term.
Note. The course is taught differently, in view of the number of meeting per week is now twice, not
three times. Please DO NOT spend too much time on old prelim problems.
1. Let,
y= Y/N, k = K/N, A = 1,

Economics 3140-1
Second Prelim
03252009
Please Choose Five Problems
(If more than 5 are answered, only the first 5 will be graded)
1.
Consider an economy with an aggregate production function:
Y = A K1/2 N 1/2,
Depreciation is ten percent, population grow

Econ 3140-2 Simulated First Prelim 09272009
(1) President Ronald Reagan launched a program of tax-cutting to reduce Federal government spending,
so that the State would have to play a limited role in the society. This won support from some economists
but

Introduction to Options and
Introduction
Options Pricing
Options
14-1
Definition
Options are a right - not an obligation
to receive or deliver an underlying
security at a specified price on or
before a specified date.
Options are a form of derivative se

Lecture #18
M&A Analysis:
The PowerWoman International Case
November 2nd, 2010
Copyright 2010 by Rich Curtis
Pre-Merger Data:
PowerWoman
Womens Wealth
5M
2M
$12.5 M/year
$5 M/year
Shares Outstanding
Earnings
Total Equity Market Value
$500 M
$108 M
a. Plea

Lecture #18
M&A Analysis: The HungryBigFish Case
November 2nd, 2010
Copyright 2010 by Rich Curtis
Pre-Merger Data:
HBF
Shares Outstanding
Earnings
Total Equity Market Value
SSM
100,000
60,000
$200,000/year
$60,000/year
$6,000,000
$900,000
a. Please fill i

C hapter 1 I ntr oduction to C or por ate F inance
Key Concepts and Skills
Know the basic types of financial management decisions and the role of the financial manager Know the financial implications of the different forms of business organization Know t

Quiz #2 HADM225 Formulas: t=
Name:_
ln(FV / PV) ln(1 r)
1- 1
FV = PV(1 + r)t
r = (FV / PV)1/t 1
PV(Perpetuity)=C/r
Annuity Present Value
C
1 r r
t
; Annuity Future Value
C
1 r r
t
1
EAR
1
APR/n
n
1 ; APR
n
1 EAR
1
n
1 ; where

1. Financial leverage refers to the: a. amount of debt used in a firm's capital structure. b. ratio of retained earnings to shareholders' equity. c. ratio of paid-in surplus to shareholders' equity. d. ratio of cost-of-goods-sold to total sales. e. a

Quiz #1 HADM225 Formulas: t=
Name:_
ln(FV / PV) ln(1 r)
FV = PV(1 + r)t
r = (FV / PV)1/t 1
Round all answers to four decimal places. SHOW ALL WORK. 1. (4 points) In 1979, Larry Bird of the Boston Celtics was the highest paid rookie in the NBA w

Multiple choice (2 points each) 1. The person generally directly responsible for overseeing the tax management, cost accounting, financial accounting, and data processing functions is the: a. treasurer. b. director. c. controller. d. chairman of the