Name _
1.
You have extra money to invest for exactly one year, after which you will need to sell the investment to pay for
college. You decide you want to buy Intel stock, which is currently selling for $53 per share and will pay $0.16
the next year in di
Running head: NRS 490 CANYON WEEK 10 ASSIGNMENT
NRS 490 Canyon Week 10 Assignment
Name
Institution
1
NRS 490 CANYON WEEK 10 ASSIGNMENT
2
Learning the Professional Capstone and Practicum Course was an involving
experience in an actual medical facility. It
The birth of a test question
You have a constant growth stock with the following
characteristics:
D0 = 1.50
g = 6%
k = 11.5%
What is P0?
P0 = D1 / k g = 1.50 *1.06 = 1.59 / .115 - .06 = 1.59 / .
055 = $28.91
The birth of a test question
You have a constan
Fiscal 2014 Annual Report
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the Fiscal Year Ended September 28, 2014
or
TRANSITION REPOR
9-1
Instructors Notes: Students
must augment these materials for
their own study purposes!
Stocks and Their Valuation
Features of Common Stock
Determining Common Stock Values
Preferred Stock
October is one of the
peculiarly dangerous
months to speculate i
Solutions to the Time Value
of Money Problems
FIN301
Question # 1
P0 = D/r , D = $2.00, r = 0.08/2 = 0.04
So:
P0 = $2.00/0.04 = $50.00
Question # 2
Semi-annual compounding required so, halve
the rate & double the number of periods
PV =-6,000; i= 4; n= 6;
Introduction to
Financial Management
Instructors Notes: Students
must augment these materials
for their own study purposes!
Mark D. Griffiths
FSB 3009
Office Hrs:
T&R 2:30-3:30
Other by appt.
Note: I am NEVER
available before
noon!
Employment Experien
Time Value Review
1.
The FCC Company is expected to pay $2 every 6 months indefinitely on its
preferred shares. If Allyn Petrie's required rate of return is 8% compounded
semiannually, what will she be willing to pay for a preferred share of FCC? ($50)
2.
1
FINA 301 Fall 2013
Dr. Mark D Griffiths
Self Test #4
1. What is the present value to an investor today of receiving a lump sum of $10,000 in one
year if one-year rates are 4.75%?
2. How much will $15,000 invested for five years be worth if the fund earn
Instructors Notes: Students must
augment these materials for their
own study purposes!
TimeValueofMoney
Future Value
Present Value
Annuities
Rates of Return
Amortization
BasicDefinitions
Present Value
(PV)
The current value of future cash flows
discount
The Capital Allocation Process
In a well-functioning economy, capital flows
efficiently from those who supply capital to those
who demand it.
Suppliers of capital: individuals and institutions
with excess funds. These groups are saving
money and looking f
FINA 301 Fall 2013
Dr. Mark D Griffiths
Self Test #7
Time Value of Money Problems
1. What will a deposit of $4,500 at 10% compounded semiannually be worth if left in the bank
for
six years?
a. $8,020.22
b. $7,959.55
c. $8,081.55
d. $8,181.55
2. What will
Instructors Notes: Students must
augment these materials for their own
study purposes!
KeyConceptsandSkills
Understand:
The effect of financial leverage on cash flows
and cost of equity
The impact of taxes and bankruptcy on
capital structure choice
Th
VAT = value added tax (sales taxes); NIC = Employee withholding taxes
KeyConceptsandSkills
Know:
The difference between book value and
market value
The difference between accounting income
and cash flow
The difference between average and
marginal tax r
FIN301 Sample Problems
Note: These are sample problems only
covering some of the course material.
Final exam questions may be more
extensive and cover material previously
examined in Assignments and Mid-term
Exams
Sample Problem 1
You are told on your mo
Scottsdale Ceramic Supply
This Case is Really About the
Value of Cash Flow
WHY? - Because Accounting Methods Measure
the Relative Sizes and Changes in the Levels of Cash
Flow and Cash Flow Creates Value
The Cash Conversion Cycle
Receivables
Cash
Sales
Inv
9-1
Example
Hilda Hornbill Has Invested 60% of Her Money in
Share A & The Remainder in Share B. She
Believes Share A Has an Expected Return of
20% and a Standard Deviation of 25%, While
Share B Has an Expected Return of 25% and a
Standard Deviation of 27%
This revision August 14, 2014
Scottsdale Ceramic Supply1
After an amazing growth rate in business in recent years attributable to the building
boom in the Phoenix area, Renzo Hernandez, the owner-manager of Scottsdale
Ceramic Supply [SCS] was anticipating
Instructors Notes: Students must
augment these materials for their own
study purposes!
TheBasicsofCapitalBudgeting
Should we
build this
plant?
KeyConceptsandSkills
Understand how to:
Determine the relevant cash flows for a
proposed investment
Analyze a
7-1
KeyConceptsandSkills
Know the important bond features and bond
types
Understand:
Bond values and why they fluctuate
Bond ratings and what they mean
The impact of inflation on interest rates
The term structure of interest rates and the
determinan
9-1
Instructors Notes: Students must
augment these materials for their
own study purposes!
KeyConceptsandSkills
Understand:
The payback rule and its shortcomings
Accounting rates of return and their problems
The internal rate of return and its strengt
Quadratic Root Calculator
The IRR Equation for three cash flows may be written as the Quadratic equation thus
allowing the use Quadratic Formula to find the roots of the Quadratic equation in turn
getting the solution set for internal rate of return.
Quad
9-1
Instructors Notes: Students
must augment these materials
for their own study purposes!
Stocks and Their Valuation:
Part 2
Features of Common Stock
Determining Common Stock Values
Preferred Stock
The average real return (the return on a portfolio of al
Portfolio Standard Deviation
This is a create-your-own portfolio problem. I've got it set up to calculate the 3 asset example
presented in class but you can change it to any problem you wish by changing the parameter
inputs. Remember, a security is perfec
1
FINA 301 Fall 2013
Dr. Mark D Griffiths
Self Test #6
Assume that today is 5/15/11 and an investor with a horizon of 5/15/15 is considering the
following alternative semi-annual bonds.
Bond
1
2
3
4
5
6
Face Value
100.00
100.00
100.00
100.00
100.00
100.00
1
FINA 301 Fall 2013
Dr. Mark D Griffiths
Self Test #1
1. If the balance in a firms cash account on its Balance Sheet decreases from one year to the
next, this is considered a use of funds.
A. True
B. False
2. If the balance in a firms retained earnings a