FIN 3313 EXAM 1
1. U.S. public companies are required to file their annual financial statements with the U.S.
Securities and Exchange Commission on which form?
a. 10-k
b. 10-SEC
c. 10-A
d. 10-Q
2. A delivery company is creating a balance sheet. Which of t
FIN 3313 EXAM 2 Summer 2014
1. A bank offers a loan that will require you to pay 5.69% interest compounded monthly. Which of
the following is closest to the EAR charged by the bank?
a. 6.00%
b. 5.84%
c. 72.00%
d. 6.17%
2. A bank pays interest quarterly wi
Dr. Sudhakar Raju
FN 3000
ASSIGNMENT QUESTIONS FOR CHAPTER 4 (Time Value of Money)
1. First City Bank pays 7 percent simple interest on its savings account balances, whereas
Second City Bank pays 7 percent interest compounded annually. If you made a $6,00
Chapter
12
Cost of Capital
12.1
Issues in Chapter 12
What
is cost of capital?
Why is cost of capital important?
Know how to determine a firms cost of equity
Common
stock
Preferred stock
Know
how to determine a firms cost of debt
Know how to determine a
Starting Investing
Finance 3312
Author: Dr. Ha-Chin Yi
Time Really IS Money!
EarlyBird Johnson: I've earned a compounded rate of 8% over
the past 30 years.
LateComer Larry: What a coincidence, so have I!
EarlyBird: Yes, I started contributing $2,500 a yea
Leslie Castelan
FIN 3312
Time Really Is Money
I am a 22 year old who has worked for the same company for over six years now and I have never signed
up for a 401K. After reading this article I went straight to my benefits coordinator and signed up right aw
Time Value of Money Question and Problems
Class Hour: _
Name: _
1.
You need $15,000 for a new car. If you can deposit $10,000 today into an account that pays an APR of
5.5% based on daily compounding, how long will it take for you to be able to buy the ne
Finance 3313 Worksheet
1
Last Updated, April 11, 2016
Time Value of Money Table
TVM Formula
1
2
3
4
5
FV = PV (1+i)
FV of a lump
sum
FV
PV of a lump
PV =
sum
(1 + i ) N
1
The interest
FV N
rate required=i
1
PV
for a PV to grow
to a FV
The length of
FIN 3313 EXAM 3 SUMMER 2014
1.
The owner of a hair salon spends $1,000,000 to renovate its premises, estimating that this will increase
her cash flow by $220,000 per year. She constructs the above graph, which shows the net present value as
a function of
FIN 3313 EXAM 4 SUMMER 2014
1. You placed an order to purchase stock where you specified the maximum price you were willing
to pay. This type of order is known as a
a. Market order
b. Maximum order
c. Limit order
d. Floor order
2. Matilda Industries pays
Chapter 12 - Cost of Capital
CHAPTER 12
COST OF CAPITAL
Answers to Concepts Review and Critical Thinking Questions
1.
It is the minimum rate of return the firm must earn overall on its existing assets. If it earns more than
this, value is created.
2.
Book
Chapter 11 - Risk and Return
CHAPTER 11
RISK AND RETURN
Answers to Concepts Review and Critical Thinking Questions
1.
Some of the risk in holding any asset is unique to the asset in question. By investing in a variety of
assets, this unsystematic portion
Chapter 10 - Some Lessons From Capital Market History
CHAPTER 10
SOME LESSONS FROM CAPITAL
MARKET HISTORY
Answers to Concepts Review and Critical Thinking Questions
1.
They all wish they had! Since they didnt, it must have been the case that the stellar p
Chapter 03 - Working With Financial Statements
CHAPTER 3
WORKING WITH FINANCIAL
STATEMENTS
Answers to Concepts Review and Critical Thinking Questions
1.
a. If inventory is purchased with cash, then there is no change in the current ratio. If inventory is
Chapter 04 - Introduction to Valuation: The Time Value of Money
CHAPTER 4
INTRODUCTION TO VALUATION: THE
TIME VALUE OF MONEY
Answers to Concepts Review and Critical Thinking Questions
1.
Compounding refers to the growth of a dollar amount through time via
Dr. Yi
Ch 4:
Introduction to Time
Value of Money
Outlines of Ch 4 and 5: Time Value of Money (TVM)
Time is money ?
Piazzas $91 million contract
Time value of money = opportunity cost
Solve TVM problems
2
Basics
Simple present / future value problem
Simp
Chapter 05 - Discounted Cash Flow Valuation
CHAPTER 5
DISCOUNTED CASH FLOW VALUATION
Answers to Concepts Review and Critical Thinking Questions
1.
Assuming positive cash flows and a positive interest rate, both the present and the future value will
rise.
Dr. Yi
Ch 5: Advanced Topics
on
Time Value of Money
Outlines of Ch 4 and 5: Time Value of Money (TVM)
Time is money ?
Piazzas $91 million contract
Time value of money = opportunity cost
Solve TVM problems
Basics
Simple present / future value problem
Sim
Chapter 06 - Interest Rates And Bond Valuation
CHAPTER 6
INTEREST RATES AND BOND
VALUATION
Answers to Concepts Review and Critical Thinking Questions
1.
No. As interest rates fluctuate, the value of a Treasury security will fluctuate. Long-term Treasury
s
Chapter
6
Interest Rates and
Bond Valuation
1
Issues in Chapter 6
2
Bond valuation
Finding a price (annual vs. semiannual)
Finding a yield (annual vs. semiannual)
Premium, discount, and par bonds
A relationship between price and yield
Reading Wall Str
Chapter 08 - Net Present Value and other Investment Criteria
CHAPTER 8
NET PRESENT VALUE AND OTHER
INVESTMENT CRITERIA
Answers to Concepts Review and Critical Thinking Questions
1.
A payback period less than the projects life means that the NPV is positiv
1
Chapter 8
Capital Budgeting and Net Present Value
Should we
build this
plant?
Issues in Ch 8
Chapter 8: Capital Budgeting Techniques
8.1
Payback Period Rule
8.2
Average Accounting Return
8.3
Net Present Value
8.4
Internal Rate of Return
8.5
Profitabili
Ch10andCh11
Risk and Return
1
Ch10and11
Dollar return and Percentage Return
Measuring Return and Risk
Capital market history
Understanding Risk
Systematic risk vs. Unsystematic risk
Diversification
Capital Asset pricing Model (CAPM)
Historical returns and
AppmhbrROSS_36076 11/13/00 9:15 AM Page 551
APPENDIX
D
Using the HP-10B and
TI BA II Plus Financial
Calculators
This appendix is intended to help you use your Hewlett-Packard HP10B or Texas Instruments BA II Plus financial calculator to solve problems enc