Question 1:
a) 3 marks
Ted Ltd is entitled to receive a cash inflow of $8,000 in 2 years time and a further cash inflow
of $14,000 in 5 years time (in year 5). If the interest rate is 8.5% per annum, how much is
this stream of cash inflows worth:
i.
today
Quantitative Techniques for Business 203
Project
School of Economics and Finance
Curtin University
Felix Chan
July 2014
1
Introduction
The aim of this project is to evaluate different portfolio compositions of financial
assets based on time series data. I
Assignment 1 Semester 1, 2016
Due April 8, 4pm
Question 1:
Consider a bakery that estimates its requirement of wheat in May as 50,000 bushels. The manager
of the bakery can hedge against price risk by going long on 10 May wheat futures contracts at the
cu
Question1: Mechanism of futures markets
A company enters into a long futures contract to buy 1,000 units of a commodity for $60 per
unit. The initial margin is $6,000 and the maintenance margin is $4,000. What futures price
will allow $2,000 to be withdra
FNCE5002 Contemporary Issues in Strategic Finance
Module 1: Introduction to Enterprise Risk Management
Question 1
The Gig, an Australian heavy metal band, has decided to let its fans invest in the music
industry and guaranteed that for every $100 invested
Q1) Time value of Money (CM) & Interest rates (ChS)
b)
d)
1’)
Assume you deposit $1000 today in an account that pays an 8% Effective Annual interest
rate (EAR). How much will you have in four yea rs? (2 marks)
Suppose you have just celebrated you nineteen
Portfolio Cover Sheet
Management Control Systems 301
Due: 12 noon on Wednesday, 13 August 2014
Family Name / Surname:
LAUWMAN
Other Names:
JASON ELVANDER
Student ID:
16456314
Name of Tutor:
JENNIFER KOH
Workshop day / Workshop time:
MONDAY/ 1PM-4PM
Questi
Lecture 2
SECURITIES MARKETS
1
Lesson Outline
1. Financial markets - broad overview of their role and
functions
2. The role of brokerage houses and financial intermediaries
3. The Australian Stock Exchange - functions and regulation
4. Trading in stocks -
Reference Book: Ross, S. A., Thomson, S. C., Christensen, M. J., Westerfield, R. W., and
Jordan, B. D. (2007). Fundamentals of Corporate Finance, 4th edition,
Sydney: McGraw-Hill.
Chapter 1
Introduction to corporate finance
Questions and Problems
3
3. Can
Chapter 1 Introduction to Corporate Finance
Questions from the required textbook at the end of Chapter 1
4. Would our goal of maximizing the value of the shares be different if we were
thinking about financial management in a foreign country? Why or why n
Quantitative Techniques for Business 203
Tutorial 3 Solutions
Felix Chan
March 2014
Question 2. Let X N (1, 2), find P (X > 0), P (1 < X < 1), P (1 < X < 1.5) and
P (X < 3).
Solution: Let z = (X + 1)/2, i.e. z is the standardized version of X.
P (X > 0) =
Quantitative Techniques in Business
Tutorial 10
Felix Chan
September 2014
Question 1. Download the file tut10.xlsx from Blackboard. In the file there are
two sets of data, each with 200 observations. The first column contains the returns of
firms that off
Quantitative Techniques for Business
Tutorial 9
Felix Chan
April 2014
Question 1. Download the file tutorial04 q2.xlsx from Blackboard. The file contains the
population data for the variable X. Let Xi be a random variable representing a random
draw from X
Quantitative Techniques for Business 203
Tutorial 7 Solutions
Felix Chan
March 2014
Question 1. Let X be a discrete random variable with 5 possible outcomes, namely
cfw_3, 1, 0, 1, 2, with probabilities cfw_0.2, 0.1, 0.3, 0.3, 0.1.
a. Calcualte E(X), E(X
Quantitative Techniques for Business 203
Tutorial 2 Solutions
Felix Chan
March 2014
Question 1. Let X1 be a random variable representing the outcome of rolling a six-sided
die (assuming fair). Write down all the possible outcomes and their probabilities.
Quantitative Techniques for Business 203
Tutorial 8 Solutions
Felix Chan
March 2014
Question 1. Let X N (1, 4), find P (X > 0), P (1 < X < 1), P (1 < X < 1.5) and
P (X < 3).
Solution: Let z = (X + 1)/2, i.e. z is the standardized version of X.
P (X > 0) =
Problem 16.9 Lancaster Technology: Euro-based investors (B)
Using the same data but assuming an exchange rate which began at 1.4844/ in June 2004, and then consistently appreciated versus the euro 1.50%
per year for the entire period. Calculate the annual
Problem 16.8 Lancaster Technology: Euro-based investors (A)
Using the same data, calculate the annual average total return (including dividends) to a euro-based investor holding the shares for
the entire period shown. Assume an investment of 100,000.
Shar
Problem 16.4 Anglo-American Equity Fund
An investor is evaluating a two-asset portfolio of the following two securities.
a. If the two equity funds have a correlation of +.72, what is the expected risk and return for the following three portfolio
weightin
Problem 16.3 Baltic Returns
Assume the Australian dollar returns (monthly averages) shown below for three Baltic republics. Calculate the Sharpe and Treynor
measures of market performance.
Market
Estonia
Latvia
Lithuania
Mean
Return
(R)
1.12%
0.75%
1.60%
Problem 16.1 Pacific Wietz
Katie Pittard is a European analyst and strategist for GMO, a New York-based mutual fund company. Katie is
currently evaluating the recent performance of shares in Pacific Wietz, a publicly traded specialty chemical
company in G
Problem 13.1 Uluru Oil Company
Uluru Oil Companys cost of debt is 7%. The risk-free rate of interest is 3%. The expected return
on the market portfolio is 8%. After depletion allowances, Uluru Oils effective tax rate is 25%.
Its optimal capital structure
Problem 15.2 Flatiron Group (USA)
The Flatiron Group, a private equity firm headquartered in Boulder, Colorado (US), borrows 5,000,000 for one year at
7.375% interest.
a. What is the dollar cost of this debt if the pound depreciates from $2.0625/ to $1.94
Problem 14.1 JPMorgan: Petrobras' WACC
JPMogan produced the following WACC calculation for Petrobras versus Lukoil of Russia
in their 18 June 2004, report. Evaluate the methodology and assumptions used in the
calculation. Assume a 28 % tax rate for both c
Chapter 10
Transaction Exposure
Questions
5.
Transaction exposure. What are the four main types of transactions from which
transaction exposure arises?
1.
Purchasing or selling on credit, goods or services when prices are stated in
foreign currencies,
2.
Problem 10.1 Siam Cement
Siam Cement, the Bangkok-based cement manufacturer, suffered enormous losses with the coming of the
Asian crisis in 1997. The company had been pursuing a very aggressive growth strategy in the mid-1990s,
taking on massive quantiti
Problem 8.1 Andina, S.A.
Andina SA, a Chilean company, wishes to borrow US$8,000,000 for eight weeks.
A rate of 4.00% per annum is quoted by potential lenders in New York, Great
Britain, and Switzerland using, respectively, international, British, and the
Chapter 7
Foreign Currency Derivatives
Questions
1.
Options versus futures. Explain the difference between foreign currency options and
futures and when either might be most appropriately used.
An option is a contract giving the buyer the right but not th
Problem 7.1 Australian futures
Ian Smith, the currency speculator we met earlier in the chapter, sells eight June 2007 futures contracts for 800,000 Australian dollars at the
closing price quoted in Table 7.1 on page 202. Assume that the June settlement p
Problem 6.3 Argentine Peso and PPP
The Argentine peso was fixed through a currency board at Ps1.00/US$ throughout the 1990s. In
January 2002 the Argentine peso was floated. On January 29, 2003 it was trading at Ps3.20/US$.
During that one year period Arge