Andrew Bolton
9/19/2012
MGMT E2000
PS1
Grade: 56/100
1.) The distinctions between Direct and Indirect finance are characterized by their necessities.
9/10 - need to use Direct market allows for the Lender or Borrower to
MGMT S-2000
Summer 2013
Problem Set 1
Answers
(100 pts.)
1. (10 pts.)
(5 pts for a good description of the process of direct finance)
(5 pts for a good description of indirect finance, which must mention the role of the
financial intermediary, and must us
77/100
Andrew Bolton
11/23/12
MGMT
E-2000
PS6
1.)
A.)
13 Jan 47.50 (WMT AW-E)
8.82
+1.02
8.40
8.55
1
4946
The premium for the Jan 47.50 call is $8.82
B.)For an investor to purchase the right to buy 100 shares it would be 100 x $8.82=
$882
C.) the formula
MGMT S-2000
Summer, 2013
Problem Set 3
Answers
(100 pts.)
1. (40 pts.)
(parts a and b: 15 pts. for correct calculations of the NPV of all three plans (5 pts. for
each plan) at i = 10%; 2 pts. for stating that Plan III should be adopted in part a; 3
pts. f
Andrew Bolton
12/07/2012
MGMT E-2000
PS8
58/100
1.)
A.) The buyer of the futures contract (the party with a long position) agrees on a fixed
purchase price to buy the underlying commodity (wheat, gold or T-bills, for example)
from the seller at the expira
MGMT S-2000
Summer, 2013
Problem Set 2
Answers
(100 pts.)
1. (30 pts.)
a. (5 pts.) (2 pts. for buy bonds; 3 pts. for explanation, which must allude in
some way to the money multiplier process)
Since the Central Bank wants to double the money supply, it sh
MGMT S-2000
Summer, 2013
Problem Set 5
Answers
(100 pts)
1. (30 pts)
a. (5 pts) All or nothing
The Last Sale column shows that the premium (price) of a Sept. 13 47.50 call
was $8.82 per option on one share.
b. (5 pts) All or nothing
Since an option contra
Andrew Bolton
10/14/12
MGMT E-2000
PS3
1.) To find the stream of payments lasting a total of 4 years we need to use the
Present Value formula. The discount rate is given at 5% and all we have to do
here is plug that into the formula consisting of PV=FV /
MGMT E-2000
Fall, 2012
Problem Set 7
Answers
(100 pts total)
1. (20 pts)
5 pts for correct overall shape
5 pts for correct maximum loss
5 pts for showing the kink at the strike price, $25
5 pts for showing the breakeven point at $26
2. (40 pts)
a. (20 pts
Mgmt E-2000
Fall 2012 Midterm
Answers
(100 points)
Note: 1 point will be deducted for an arithmetic error, as long as all
equations, formulas, etc., are given and are correct, with the correct
numbers from the question plugged into the right places. The 1
Introduction and Overview
Functions of Financial Markets: What Do
Financial Markets Do, and How Do They
Do It?
Where Do Companies Get Funds?
Financial Intermediation vs. Direct Finance
Primary vs. Secondary Markets
Bank-Centered Systems vs. Market-C
Mgmt S-2000
Summer 2013 Midterm
Answers
(100 points)
Note: 1 point will be deducted for an arithmetic error, as long as all
equations, formulas, etc., are given and are correct, with the correct
numbers from the question plugged into the right places. The
1MGMT E-2000
Principles of Finance
Harvard University Extension School
Fall, 2012
Professor: Bruce Watson
[email protected]
Tuesdays, 7:40 9:40 PM
Science Center D
Course Web Site: http:/isites.harvard.edu/course/ext-13407/2012/fall
Teaching Assis
MGMT S-2000
Summer, 2013
Problem Set 4
Answers
(100 pts total)
Note: Throughoutonly 1 pt is deducted for an arithmetic mistake if all of the set-up is
correct. You dont have to state the original formulas, but should be using them to plug
the numbers in.
1MGMT E-2000
Principles of Finance
Harvard University Extension School
Fall, 2013
Professor: Bruce Watson
[email protected]
Tuesdays, 7:40 9:40 PM
Science Center A
Course Web Site: http:/isites.harvard.edu/course/ext-13407/2013/fall
Teaching Assis
19:52:32 [kerrienganguyen] Yeah, I might as well complete it today =)
19:52:48 cferguson entered this room.
19:52:58 [kerrienganguyen] almost done with 4 and 5, although I have to confirm somethings with Teo
19:55:43 nithinre entered this room.
19:56:05 r
Andrew Bolton
10/27/12
EMGMT 2000
PS4
1.)
a. F = $100, c = 10%, N = 2, i = 8%
10/(1+.08)^1 + 10/(1+.08)^2 + 100/(1+.08)^2
$9.259
$8.573
$85.733 = $103.565 or $103.56
Check : i <c Pb >F or 8% < 10% $103.56 > $100
b. F = $10,000, c = 6%, N = 3, i = 9%
600/(
Andrew Bolton
12/07/2012
MGMT E-2000
PS8
1.)
A.) The buyer of the futures contract (the party with a long position) agrees on a fixed
purchase price to buy the underlying commodity (wheat, gold or T-bills, for example)
from the seller at the expiration of