Class 3
Value and Valuation (Part I)
Time Value of Money and Valuation of
Bond and Stock
Dr. Scott Fung
California State University, East Bay
Fall 2011
Finance - Scott Fung (2011)
1
Overview:
Objectives, Important Concepts and Learning Outcomes
Learning O
Name: _
Date:_
FIN 3300
Assignment #4
Show all work and circle your final answer. Round final answer to the nearest hundredth.
1. Your business needs to take out a $100,000, ten-year loan at 8% per year. The loan calls for
equal annual payments. How much
The Time Value
of Money
Future Value
- Amount to which an investment
will grow after earning interest.
Topics Covered
Future Values
Present Values
Multiple Cash Flows
Perpetuities and Annuities
Inflation & Time Value
Effective Annual Interest Rate
Simple
Topics Covered
Bond Characteristics
Bond Valuation
Terminology
Bond
- Security that obligates the issuer to
make specified payments to the
bondholder.
Face Value (Par Value)
- Payment at the maturity of the bond.
reading the financial pages
Interest Rates
Topics Covered
Introduction To
Corporate Finance
Financial Management Decisions
Investment and Financing Decisions
What is Corporation?
Who Is The Financial Manager?
Goals of the Corporation
Careers in Finance
Boeing 767 project => 3 billion
Capital budge
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #1 (SOLUTION GUIDE)
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com.
The due date is End of Week #2 (April 10th).
Questi
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #2
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com.
The due date is End of Week #3 (April 17th, 2011).
Question 1. Short
FIN 3300 FINANCIAL MANAGEMENT
Spring 2011 (Section 01)
Individual Research Assignments (Part I)
IMPORTANT: This is Individual Research Assignments. There are 2 parts of the assignments,
and this document contains the detailed instructions for PART I only.
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #2 (SOLUTION GUIDE)
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com.
The due date is End of Week #3 (April 17th, 2011).
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #3 (SOLUTION GUIDE)
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com. The due date is End of Week #4
(April 24th, 2011).
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #3
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com. The due date is End of Week #4
(April 24th, 2011).
Question 1. [FCF]
FIN 3300 FINANCIAL MANAGEMENT
Spring 2011 (Section 01)
Individual Research Assignments (Part 2):
Case Study of Valuation and Capital Budgeting
IMPORTANT: This is PART 2 of Individual Research Assignments. There are 2 parts of the
assignments, and this doc
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #4
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com. The due date is End of Week #7
(May 15th, 2011).
Question 1. Capital
What should be the
market reaction to the
following news?
Topics Covered
Accounting and Finance
The Balance Sheet
The Income Statement
The Statement of Cash Flows
Accounting for Differences
Taxes
1
Balance Sheet
The balance sheet is a snapshot of the
firm
Solutions to Chapter 20 Cash and Inventory Management 1. Ledger balance = starting balance payments + deposits Ledger balance = $250,000 $20,000 $60,000 + $45,000 = $215,000 The payment float is the outstanding total of not-yet-cleared checks written by t
Name: _
Date:_
FIN 3300
Assignment #3
Show all work and circle your final answer. Round final answer to the nearest hundredth.
You are planning your retirement in 20 years. You currently have $50,000 in Account A and
$75,000 in Account B. You plan to add
Name: _
Date:_
FIN 3300
Assignment #5
Show all work and circle your final answer. Round final answer to the nearest hundredth.
1. A firms dividends are expected to grow quickly at a 20% rate over the next three years.
Afterward, they will reduce their div
Name: _
Date:_
FIN 3300
Assignment #2
Show all work and circle your final answer. Round final answer to the nearest hundredth.
1. An investment project will pay your firm $2,000 per year. The first payment will come 3
years from today and the last payment
Name: _
Date:_
FIN 3300
Assignment #1
Show all work and circle your final answer. Round final answer to the nearest hundredth.
1. You expected to receive $10,000 at graduation in two years. You plan on investing it at 10%
compounded semiannually until you
Solutions to Chapter 3 Homework
10.
Taxes on your salary = (0.10 $7,300) + 0.15 ($29,700 $7,300)
+ 0.25 ($70,000 $29,700) = $14,165
Taxes on corporate income = 0.15 $30,000 = $4,500
Total taxes = $14,165 + $4,500 = $18,665
If you rearrange income so that
Solutions to Chapter 4 Homework
23.
a.
b.
1
1
$267.30
PV = 100 annuity factor(6%, 3 periods) = 100
3
0.06 0.06(1.06)
If the payment stream is deferred by an additional year, then each payment is
discounted by an additional factor of 1.06. Therefore, t
Example: Minicase on Page 237 of textbook. Bring the book or a copy of page 237 with you to class Wednesday, Oct. 15! Table 8-6: Forecasted Income Statement ($ figures in thousands. Except price per yard.) Year 1 2 3 1. Yards sold 100 100 100 2. Price per
Solutions to Chapter 7 Net Present Value and Other Investment Criteria 1. NPVA = $200 + [$80 annuity factor(11%, 4 periods)] = $48.20 NPVB = $200 + [$100 annuity factor(11%, 3 periods)] = $44.37 Both projects are worth pursuing. 2. Choose Project A, the p
Solutions for Chapter 16
Dividend Policy
1.
a.
May 7:
Declaration date
June 6:
Last with-dividend date
June 7:
Ex-dividend date
June 11:
Record date
July 2:
Payment date
b.
The stock price will fall on the ex-dividend date, June 7. The price falls on this
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #4 (SOLUTION GUIDE)
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com. The due date is End of Week #7
(May 15th, 2011).
Qu
FIN 3300 Financial Management
SPRING 2011 (Section 03)
Homework #5
IMPORTANT Note: This homework must be done individually. Please submit your
own answers to mba.finance.sfung@gmail.com. The due date is End of Week #8
(May 22nd, 2011).
Question 1. Financi
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CSUEB FIN 3300 MIDTERM 2 SAMPLE
AUGUST 2016
Instructor: TEE LIM
ALL QUESTIONS 10 POINTS EACH UNLESS OTHERWISE STATED
YOUR NAME:
1. What is the model called that determines the present value of a stock
based on its next annual dividend, the dividend growth