ROE (ROR on Balance)
Cash Out as % of Earnings
REQUIRED ROR
Time
Earnings @ ROE=0%
Balance Before Withdrawal
Cash Withdrawal @ 0%
Balance After Withdrawal
Increase in Balance
Increase in Earnings
Increase in Withdrawals
Return on Equity is the rate you ex
THE UNIT CIRCLE
For the quarter circle and the pi experiment, see the graph below
x
1
0.999
0.998
0.997
0.996
0.995
0.994
0.993
0.992
0.991
0.99
0.98
0.97
0.96
0.95
0.94
0.93
0.92
0.91
0.9
0.89
0.88
0.87
0.86
0.85
0.84
0.83
0.8
The Yield Curve
Selected Interest Rates http:/www.federalreserve.gov/releases/h15/update/
Federal Reserve Board Statistics http:/www.federalreserve.gov/releases/
The Living Yield Curve http:/www.smartmoney.com/investing/bonds/thelivingyieldcurve7923/
To Calculate Loan Amortization Schedule for the Home:
Loan Principal (Po)
Interest Rate (r)
Term (n) cfw_20 max
Payment
Loan
Amortization
Table
200,000 A fully amortized loan is paid off in equal periodic installments (Pmt).
10.00% Each period, part of th
Employee Data and Sales Stats
Employee Name
Building Department
Page, Lisa
Taylor, Hector
Dawson, Jonathan
Duran, Brian
Weber, Larry
Pratt, Erik
Oconnor, Kent
Spencer, Boyd
Wiggins, Frank
Tanner, Timothy
Strickland, Rajean
Chase, Troy
Brewer, Khurrum
Wilk
Helpful Hints for Firm Valuations
ValuationHints.doc
Often the focus of a valuation is one or more of the following:
Total assets (TA)
Selected assets (A1, A2 )
Equity (or stock) (E)
Liabilities (LIAB)
Although the book values of the above items found on
This quiz is to be completed without help or assistance from anyone else.
By entering your name below you certify that you have not given or received help on this quiz.
2digit #
your name here
Complete the following:
Enter your name and 2digit class # i
Rawls College of Business
Texas Tech University
Spring 2012
Corporate Finance 1
Instructor: George D. Cashman
FIN 3322 T, Th 2.003.20; 3.304.50
[email protected]
Office Hours T, Th 10.00am10.50am
Office: Rawls 317W
Rawls 01
(806)8341932
Michael Ni
Syllabus for Finance 3322
Corporation Finance I
Fall, 2014
Instructor:
Dr. Robert J. Ritchey
Office: W314 Phone: 8343956
Email: [email protected]
Office Hours: Tue & Thur: 12:30 2:00 and by appointment.
Occasionally I will not be able to meet these offic
Exhibit 1
Energy Coal Resources, Inc.
Conclusion of Value  Minority Basis
As of December 31, 2008
US Dollars
Indicated Value
NonOperating
of Invested Capital +
Assets
Interest Bearing

Debt
Preferred

Series A
Indicated Value
=
of Equity
Weighted
Weig
Constrained Optimization
Your business needs a different number of workers each day.
Once you schedule someone they work for 5 straight days.
Minimize the total extra workers without being short.
Day
Monday
Tuesday
Wednesday
Thursday
Friday
Saturday
Sunda
SolverAssignment.xlsx
Example 6: Value of a resistor in an electrical circuit.
Find the value of a resistor in an electrical circuit that will dissipate the charge to 1
percent of its original value within onetwentieth of a second after the switch is clo
SolverAssignment.xlsx
Example 4: Working Capital Management.
Determine how to invest excess cash in 1month, 3month and 6month CDs so as to
maximize interest income while meeting company cash requirements (plus safety margin).
1mo CDs:
3mo CDs:
6mo C
SolverAssignment.xlsx
Example 5: Efficient stock portfolio.
Find the weightings of stocks in an efficient portfolio that maximizes the portfolio rate of
return for a given level of risk. This worksheet uses the Sharpe singleindex model; you
can also use
Staff Scheduling
Example 3: Personnel scheduling for an Amusement Park.
For employees working five consecutive days with two days off, find the schedule that meets demand
from attendance levels while minimizing payroll costs.
Sch.
A
B
C
D
E
F
G
Days off
E
SolverAssignment.xlsx
Example 1: Product mix problem with diminishing profit margin.
Your company manufactures TVs, stereos and speakers, using a common parts inventory
of power supplies, speaker cones, etc. Parts are in limited supply and you must determ
SolverAssignment.xlsx
Example 2: Transportation Problem.
Minimize the costs of shipping goods from production plants to warehouses near metropolitan demand
centers, while not exceeding the supply available from each plant and meeting the demand from each
Using SOLVER to find Multiple IRR's
The SOLVER A
33.00% < Cost of Capital
to find the Cost
the Net Present
Year
NCF
Discount Factor
Discounted
NCF
0
(1)
1.0000
(1.000)
1
6
0.7519
4.511
2
(11)
0.5653
(6.219)
3
6
0.4251
2.550
4
0
0.3196
0.000
Net Present V
Scale Models, Incorporated
Capital Budgeting and Cash Flow Analysis
Scale Models, Inc. is a small family
owned manufacturer of a line of radio
control scale model airplanes which it
markets directly to consumers. At present
their financial manager, Dudley
Roulette: "Bankroll Simulation"
There are 38 possible outcomes, two are double zero, 18 are black and 18 are red.
If you bet either black or red your chances of winning an amount equal to your bet is
18/38. If you win you keep your bet and receive an addi
Risk and Return Tradeoff
RiskReturnTradeoff.xls
A & B are mutually
exclusive alternatives
Return of A > Return of A = Return of A <
Return of B
Return of B
Return of B
Risk of A > Risk of B
?
Prefer B
Prefer B
Risk of A = Risk of B
Prefer A
Indifferent
Pr
Selected Risk Measures
RiskMeasures.doc
Beta
Measures systematic (nondiversifiable/market related)
risk
Appropriate for well diversified investors
Relative (as opposed to absolute) risk measure
Standard Deviation or Variance
Measures total (diversifi
Reeby Sports
Enter Your Name Here
Beyond year 2007:
All dollar figures in millions, except as noted
Dividend payout =
40.0%
Table 46
Tax Rate =
35%
Look carefully at cells containing comments!
Long run growth =
6.30%
Table 48
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