Ethics and Professional Standards
What is the Purpose of Financial Markets?
EFFICIENT RESOURCE (SAVINGS) ALLOCATION
Why Ethics Matters
Ethics can be defined as set of moral principles or rules of conduct that provide
guidance for our behavior when it affe
CHAPTER 02FINANCIAL MARKETS AND INSTITUTIONS
Note that there is an overlap between the T/F and multiple-choice questions, as some of the T/F statements are used in
Multiple Choice: True/False
1. A financial intermediary is a cor
The Cost of Capital
ortune magazine conducts annual surveys of business leaders to identify the
most-admired U.S. companies. Since the surveys began, General Electric has
consistently ranked either at or close to the top of the list. Although
Financial Options and
Applications in Corporate
n 2008, Cisco had almost 1.2 billion outstanding employee stock options
and about 5.9 billion outstanding shares of stock. If all these options are
exercised, then the option holders will
The Basics of Capital
PL Group is a holding company that owns Florida Power & Light,
electric generating plants across the country, the nations largest fleet
of wind turbines, and major solar power facilities.
Risk, Return, and the Capital
Asset Pricing Model
s sung by the Grateful Dead, What a long, strange trip its been!
The chart below provides some insights into the stock markets
risks and returns. The top portion shows the relative changes in
Part 1: Fundamental Concepts of Corporate Finance
g. Perform a common size analysis and percentage change analysis. What do these
analyses tell you about Computron?
h. Use the extended Du Pont equation to provide a summary and overview of Computrons f
Bonds, Bond Valuation,
and Interest Rates
lot of U.S. bonds have been issued, and we mean a lot! According to
the Federal Reserve, there are about $5.7 trillion of outstanding U.S.
Treasury securities, more than $2.6 trillion of municipal secu
Part 3: Stocks and Options
Corporate Valuation and Stock Prices
In Chapter 1, we told you that managers should strive to
maximize intrinsic value and that the value of a firm is
determined by the size, timing, and risk of its free cash
flows (FCF). Re
Financial Statements, Cash
Flow, and Taxes
ven in todays era of financial crises, $14.6 billion is a lot of money. This
is the amount of cash flow that Hewlett-Packards (HP) operations
generated in 2008, up from $9.6 billion in 2007, despite t
rt. rmancrai stocks use on espectatrons or increases to loan demand, nousmg consuucnons and se
E. Consumer durable stocks rise on expectations of rising consumer conﬁdence and personal incor
C. Capital goods stocks rise on espectation of increa
CHAPTER 12MACROANALYSIS AND MICROVALUATION OF THE STOCK MARKET TRUE/FALSE
1. A main limitation of the NBER indicator series is false signals.
2. Stock prices move coincidentally with the economy.
3. The cyclical indicator approach to market analysis
i8. Which of the following is not considered a basic competitive fr
t. Rivalry among erristing competitors
3. Threat of new enu'ants
I. Threat of suhstinrte products
I‘ 1111-1111- .n'F n n1: :I'rrw'rlrrl ﬁ'l'l“ fnd-nv-annnJ-ﬁ
39. Which of the following is
2. The financial risk for the retail store industry is difficult to judge because of
t. Corrver‘dble debt.
i. Numerous building leases.
‘f the range.
t. More volatile, low end
i. More volatile, high end
3. Less volatile, low end
J. Less volat
INTRODUCTION TO SECURITY VALUATION
1 The three step valuation process consists of 1) analysis of alternative
and markets, 2) analysis of alternative industries and 3) analysis of industry
MULTIPLE CHOICE QUESTIONS
1 Which of the following is not a consideration in the three-step valuation
a) Analysis of alternative economies
b) Analysis of security markets
c) Analysis of alternative industries
d) Analysis of individual compani
7 According to the dividend growth model, if a company were to declare that it
would never pay dividends, its value would be
a) Based on earnings.
b) Based on expectations regarding.
c) Higher than similar firms since it could reinvest a greater amoun
61. Which of the following statements regarding a
property sold under instalment method and not
subject to a mortgage is false?
65. Statement 1: The capital gain tax on shares of
stock should be paid by the seller within thirty days
from the date of sale.
Maricel E. Ranile
Figures of Speech
A figure of speech is figurative language in the form of a single word or
phrase. It can be a special repetition, arrangement or omission of words with
literal meaning, or a phrase with a specialized meaning n
1|P a g e C R E D I T T R A N S A C T I O N R E V I E W E R
CREDIT TRANSACTION [Q & A Reviewer]
1. What are the rights and obligations of the
parties in a contract of loan?
OBLIGATIONS OF THE BAILEE:
1. Take care of the thing with d
FACULTY OF BUSINESS
SECURITY INVESTMENT AND PORTFOLIO MANAGEMENT
JUNE 2010 SEMESTER
INSTRUCTIONS TO STUDENTS
1) This assignment has a ONE (1) question only. You must write and submit the
report in English.
2) Your a
We should choose Bank A since it has a higher EAR.
Assuming that there is a high probability of making a withdrawal during the year, Bank B
might be preferable since it has a shorter compounding period, 1 day, as compared to Ban
8-21 Crissie just won the lottery, and she must choose between three award options. She can
elect to receive a lump sum today of $61 million, to receive 10 end-of-year payments of $9.5
million, or to receive 30 end-of-year payments of $5.5 million.