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Corporate Financial Design AFIN353
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Tutorial 1, Week 2
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Homework questions.
Question 1 (217) NPV, DDM, stock pricing
A stock is expected to pay a dividend of $15 in one year (t=1), then $25 for 9 years after that (

Answer each of the following questions in the space provided below the questions. Mark
allocations are noted next to each question.
Question 1 (total of 10 marks): Below is a history of the net discrete capital return on the
S&P500 index (SPI) and Warren

Answer each of the following questions in the space provided below the questions. Mark
allocations are noted next to each question.
Question 1 (total of 10 marks): Below is a history of the net discrete capital return on the
S&P500 index (SPI) and Warren

AFIN250 S2 2015
Tutorial Solutions Topic 2 (discuss week 3)
Chapter 3: 5, 12, 14, 15, 18, 19, 21
Chapter 4: 5, 6, 12, 16, 21, 26
Chapter 3
5. In what circumstances are private placements more likely to be used than public offerings?
Preparing a public iss

Question 1;
Accounting profession consists of 5 different forms of the accounting : Financial
accounting, Management accounting, Auditing, Accounting information system and
Tax accounting. They influence the decision-makers. For example, in order to succe

Tutorial 12 Week 13 - Derivatives
Question 1: Your friend is an investor and he just transacted two
equity index options:
He bought a 1 year call option with a strike price of 4,800
points for a premium of 30 points, and
Sold a 1 year put option with a st

AFIN 329 Week 1 Tutorial Solutions
Chapter 4: Problem 1
A.
Expected return is the sum of each outcome times its associated probability.
Expected return of Asset 1 = R1 = 16% 0.25 + 12% 0.5 + 8% 0.25 = 12%
R 2 = 6%; R3 = 14%; R4 = 12%
Standard deviation of

AFIN 329 Week 5 Tutorial Solutions
Chapter 13: Problem 1
The equation for the security market line is:
(
)
Ri = RF + Rm RF i
Thus, from the data in the problem we have:
(
)
6 = RF + Rm RF 0.5 for asset 1
(
)
12 = RF + Rm RF 1.5 for asset 2
Solving the abo

AFIN 329 Week 3 Tutorial Solutions
Chapter 7: Problem 3
Recall from the text that the Vasicek techniques forecast of security is beta ( i 2 ) is:
i2
2
i1
2
2
1 i1
1
2
1
2
2
1 i1
i1
where 1 is the average beta across all sample securities in the h

AFIN 329 Week 6 Tutorial Solutions
Chapter 16: Problem 1
From the text we know that three points determine a plane. The APT equation for a
plane is:
R i 0 1bi1 2 bi 2
Assuming that the three portfolios given in the problem are in equilibrium (on the
plane

Chapter 4: The Characteristics of the
Opportunity Set under Risk
Determining the Average Outcome
A Measure of Dispersion
Variance of Combinations of Assets
Modern Portfolio Theory and
Investment Analysis, 8th Edition
Characteristics of Portfolios in Gener

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