FIN 2004 Finance Tutorial 8:
Capital Budgeting II
Conducted by : Mr Chong Lock Kuah, CFA
1
Revisit some important concepts
The starting point in cash flow estimation is identifying the relevant
cash flows.
Two important rules :
Capital budgeting decisi

FINANCE
FIN2004
Lecture 6: Bond Valuation
Valuation Generally
Recall in our first lecture, finance was described as a discipline
concerned with determining values and making optimal
decisions based on those values. In finance, optimal investment
decision

FINANCE
FIN2004
Lecture 7: Stock Valuation
0
Learning Objectives
Understand how stock prices depend on future dividends
and dividend growth
Be able to compute stock prices using the dividend
growth model
Be able to compute stock prices using the Corpor

FIN 2004 Finance Tutorial 5 :
Bonds
Conducted by : Mr Chong Lock Kuah, CFA
1
Revisit some important concepts
A bond is a long-term contract under which a borrower (issuer) agrees to
make payments of interest and principal, on specific dates, to the holder

FIN 2004 Finance Tutorial 10 :
Working Capital Management
Conducted by : Mr Chong Lock Kuah, CFA
1
Key Concepts
Working capital management decides the level of each type of
current asset to hold and how to finance them.
Operating cycle : time between ac

FIN2004/FIN2004X
Tutorial 1 : Introduction & Overview of
Financial Management and Financial
Statement Analysis
Conducted by : Mr Chong Lock Kuah, CFA
0
#1:
Evaluate the following statement : Managers should not focus
on the current stock value because do

FIN 2004 Finance Tutorial 11 :
Options
Conducted by : Mr Chong Lock Kuah, CFA
1
Options Glossary
Call option
Owner of the option has the right (but not the obligation) to buy the
underlying asset at a specified price up to or at a specified date
Put opti

Tutorial 2 : Time Value of Money
Conducted by : Mr. Chong Lock Kuah, CFA
0
Key Points
The first step in time value analysis is to set up a time line, which will
help you to visualize what is happening in a particular problem
0
1
2
CF1
CF2
3
Year
I/YR
CF3

FIN 2004 Finance Tutorial 7 :
Capital Budgeting I
Conducted by : Mr Chong Lock Kuah, CFA
1
Revisit Important Concepts
The NPV of an investment is the difference between the present value
of its future cash inflows and its cost.
CFt
NPV
CF0
t
t 1 (1 r)

Tutorial 9 : Long-Term Financial Planning
Conducted by : Mr Chong Lock Kuah, CFA
0
Revisit some important concepts
Steps in financial forecasting are
1.
2.
3.
4.
5.
Forecast sales
Project the assets needed to support sales
Project internally generated fun

Tutorial 3 : Risk and Return I
Conducted by : Mr Chong Lock Kuah, CFA
0
Key Points
The average rate of return on a single risky asset from historical
data is :
n
R
R=
t =1
n
t
=
R1 + R 2 + R 3 . + Rn
n
The Geometric average return or geometric mean rate

Chapter 9: Net Present Value and Other Investment Criteria
Concept Questions:
6.
Net Present Value: Concerning NPV:
a. Describe how NPV is calculated and describe the information this measure
provides about a sequence of cash flows. What is the NPV criter