Mini Case Solution
Ch 16
Qatari Trading International
1.
SinceQTIisanallequityfirmwith9.4millionsharesofcommonstockoutstanding,andanasset
baseofQAR160million,eachsharehasamarketvalueofQAR17.02.
Themarketvaluebalancesheetwithouttheplannedprojectis:
Marketv
Mini Case Solution
Ch6
GPSWorldS.A.L.,Part1
1.
We first apply the MACRS schedule to determine the amount of annual depreciation:
MACRS Schedule
Year
Depreciation
%
L
1
0.1429
514,440,000
2
0.2449
881,640,000
3
0.1749
629,640,000
4
0.1249
449,640,000
5
0.0
Chapter 6
Problems 1-38
Input boxes in tan
Output boxes in yellow
Given data in blue
Calculations in red
Answers in green
NOTE: Some functions used in these spreadsheets may require that
the "Analysis ToolPak" or "Solver Add-in" be installed in Excel.
To
Mini Case Solution
Ch 26
Packaging Inc.
1.
Based on a 10 percent sales increase, unchanged cost-to-sales ratios and
depreciation EGP amount, the 2012 income statement is compiled as follows:
Income Statement: 2012 (in EGP '000)
Sales
Cogs 48%
SG&A 15%
Dep
Mini Case Solution
Ch11
GPSWorldS.A.L.PartII
1.
Based on the original estimates of net income (in L):
Year 1
15,000
202,500
3,037,500,00
0
1,057,500,00
0
600,000,000
514,440,000
865,560,000
129,834,000
735,726,000
Number of units
Unit price
Sales
Variable
Corporate Finance
Ross, Westerfield, and Jaffe
10th edition
Case Solutions
Input boxes in tan
Output boxes in yellow
Given data in blue
Calculations in red
Answers in green
NOTE: Some functions used in these spreadsheets may require that
the "Analysis Too
Mini Case Solution
Chapter 18:
The Leveraged Buyout of TadrosProductsInternational
In this leveraged buyout, the debt level of the company changes through time. Since the debt level
changes through time, the APV method is appropriate for evaluating the LB
Mini Case Solution
Ch 28
Packaging Inc. II
1. Todecideontheoptimalcreditpolicy,weneedtocalculatetheNPVofeachpolicy.Wewill
beginwiththecalculationoftheNPVofPIscurrentpolicy.
CurrentPolicy
First,weneedtocalculatetheaveragedailysaleswhichare:
Averagedailysal
Mini Case Solutions
Chapter 2: Cash Flows and Financial Statement of Deep Water Experts
Below are the financial statements that you are asked to prepare.
1.
The income statement for each year will look like this:
Income Statement
Cogs
2011
50,00
0
33,50
0
Mini Case Solution
China Invest International
Ch 11
All computations are based on the 20-year return history for large company stocks and Treasury bills
as given in Table 10.1; returns for small company stocks and the S&P500 stock index were provided
in t
Mini Case Solution Ch 5
SunStarHotel
1.
First, we determine the expected cash flow for each year by subtracting costs from revenue:
Year
0
1
2
3
4
5
6
7
8
9
10
Cost in EGP
-70,000,000
-23,800,000
-24,990,000
-26,239,000
-27,551,000
-28,929,000
-30,375,000
Mini Case Solution
Chapter 3: Deep Water Experts Financial Ratios
1. The financial ratios for Deep Waters Experts are as follows:
a. Liquidity
Liquidity Ratios
2011
2012
Current Ratio
2.67
3.30
Quick Ratio
1.80
2.20
Cash Ratio
1.08
1.56
All ratios indicat
Credit Value at Risk
Chapter 18
Risk Management and Financial Institutions 3e, Chapter 18, Copyright John C. Hull 2012
1
Rating Transitions
One year rating transition probabilities are
published by rating agencies.
If we assume that the rating transition
Basel I, Basel II, and
Solvency II
Chapter 12
Risk Management and Financial Institutions 3e, Chapter 12, Copyright John C. Hull 2012
1
History of Bank Regulation
Pre-1988
1988:
BIS Accord (Basel I)
1996: Amendment to BIS Accord
1999: Basel II first pr
Market Risk VaR: Historical
Simulation Approach
Chapter 14
Risk Management and Financial Institutions 3e, Chapter 14, Copyright John C. Hull 2012
1
Historical Simulation
Collect data on the daily movements in all
market variables.
The first simulation tr
Scenario Analysis and
Stress Testing
Chapter 19
Risk Management and Financial Institutions 3e, Chapter 19, Copyright John C. Hull 2012
1
Stress Testing
Key
Questions
How do we generate the scenarios?
How do we evaluate the scenarios?
What do we do with
Volatility
Chapter 10
Risk Management and Financial Institutions 3e, Chapter 10, Copyright John C. Hull 2012
1
Definition of Volatility
Suppose that Si is the value of a variable on
day i. The volatility per day is the standard
deviation of ln(Si /Si-1)
N
Market Risk VaR: ModelBuilding Approach
Chapter 15
Risk Management and Financial Institutions 3e, Chapter 15, Copyright John C. Hull 2012
1
The Model-Building Approach
The main alternative to historical simulation is to
make assumptions about the probabil
Counterparty Credit
Risk in Derivatives
Chapter 17
Risk Management and Financial Institutions 3e, Chapter 17, Copyright John C. Hull 2012
1
Clearing Arrangements for OTC
Derivatives (Figure 17.2, page 381)
Bilateral clearing: usually governed by an ISDA
M
Basel 2.5, Basel III, and
Dodd-Frank
Chapter 13
Risk Management and Financial Institutions 3e, Chapter 13, Copyright John C. Hull 2012
1
Basel 2.5 (Implementation: Dec 31, 2011)
Stressed VaR for market risk
Calculated over one year period of stressed mark
Value at Risk
Chapter 9
Risk Management and Financial Institutions 3e, Chapter 9, Copyright John C. Hull 2012
1
The Question Being Asked in VaR
What loss level is such that we are X%
confident it will not be exceeded in N
business days?
Risk Management an
Insurance Companies
and Pension Plans
Chapter 3
Risk Management and Financial Institutions 3e, Chapter 3, Copyright John C. Hull 2012
1
Types of Life Insurance (pages 41-45)
Term
life
Whole life
Variable life
Universal life
Endowment life
Group life
Institute of Banking Studies
Corporate Finance
Dr. Riyad Al-Hindwi
Assignment No. (7)
Ahmad Tawfiq Darabseh
Chapter (9)
INTEREST RATES AND BOND
VALUATION
Questions and Problems
6. Dividend yield = 1/2(.115) = .0575 = Capital gains yield
D1 = .0575($72) =
Interest Rate Risk
Chapter 8
Risk Management and Financial Institutions, 3e, Chapter 8, Copyright John C. Hull 2012
1
Management of Net Interest Income
(Table 8.1, page 159)
Suppose that the markets best guess is that future
short term rates will equal to
Trading in Financial
Markets
Chapter 5
Risk Management and Financial Institutions, 3e, Chapter 5, Copyright John C. Hull 2012
1
Financial Markets (pages 89-90)
Exchange
traded
Traditionally exchanges have used the open-outcry system,
but electronic tradi
How Traders Manage
Their Risks
Chapter 7
Risk Management and Financial Institutions, 3e, Chapter 7, Copyright John C. Hull 2012
1
A Traders Gold Portfolio. How Should
Risks Be Hedged? (Table 7.1, page 138)
Position
Value ($)
Spot Gold
Forward Contracts
Fu
The Credit Crisis of 2007
Chapter 6
Risk Management and Financial Institutions 3e, Chapter 6, Copyright John C. Hull 2012
1
U.S. Real Estate Prices, 1987 to 2011:
S&P/Case-Shiller Composite-10 Index
Risk Management and Financial Institutions 3e, Chapter 6
Correlations and
Copulas
Chapter 11
Risk Management and Financial Institutions 3e, Chapter 11, Copyright John C. Hull 2012
1
E
(E
V
)
(
V
1)
22
1
S
D
S
D
1
Correlation and Covariance
The
coefficient of correlation between two
variables V1 and V2 is defin