SCHOOL OF ECONOMICS‚ FINANCE & MARKETING CORPORATE FINANCE MID SEMESTER TEST FIRST SEMESTER 2008 – Part-time STUDENT DETAILS (Please Print Clearly) Family Name: ___________________________________________________________ First Name: _____________________________________________________________ Address: _______________________________________________________________ Tel. No: (BH) ___________________________________________________________ Student Number: _________________________________________________________
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Solutions to questions 1. Finance involves three main areas—corporate finance‚ financial institutions and markets‚ and investments—that are closely related and complementary. For example‚ in corporate finance the central issues are how to acquire and employ or invest funds. To acquire funds a financial manager must deal with financial institutions‚ so some knowledge of the operations of financial institutions and markets is essential. Similarly‚ corporate finance involves investments because decisions
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Introduction to Corporate Finance 1. Two Questions: what investments should the corporation make and how should it pay for those investments? a. Investment decisions involve spending money and financing decisions involving raising money b. Concepts govern good financial decisions c. Financial managers value the shareholders’ investment opportunities outside their company because of the opportunity cost of capital contributed by shareholders d. All managers and employees need to pull together
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Chapter 1 Corporate Finance- the acquisition and efficient use of funds required by the fund The acquisition refers to the finance decision Efficient use of funds refers to the investment decision A major aspect of corporate finance is the creation and determination of value Objective of Financial Management- Maximize shareholder wealth is the main goal—to maximize the market value of the firm 3 Main Decision Areas of Financial Manager to Achieve Maximization: 1. Investment Decision- What
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of planning and managing a firm’s long-term investments is called: A. B. C. D. E. working capital management. financial depreciation. agency cost analysis. capital budgeting. capital structure. 4. The mixture of debt and equity used by a firm to finance its operations is called: A. B. C. D. E. working capital management. financial depreciation. cost analysis. capital budgeting. capital structure. 5. The management of a firm’s short-term assets and liabilities is called: A. B. C. D. E. working capital
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(.08/12)]300} / (.08/12)] C = $2‚595‚196.06 / 129.5645 = $20‚030.14 withdrawal per month 26. This is a growing perpetuity. The present value of a growing perpetuity is: PV = C / (r – g) PV = $175‚000 / (.10 – .035) PV = $2‚692‚307.69 It is important to recognize that when dealing with annuities or perpetuities‚ the present value equation calculates the present value one period before the first payment. In this case‚ since the first payment is in two years‚ we have calculated the present value
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Department of Finance‚ HKUST Spring 2013 Email: Xuewenliu@ust.hk Office hour: 13:30-14:30 Tuesday Assessment: Assignments (12%)‚ Midterm-exam (18%)‚ Projects and presentations (15%)‚ and Final exam (55%) Textbooks: 1. Corporate Finance‚ by J. Beck and P. DeMarzo‚ 2nd edition 2011‚ Pearson Education‚ Inc. Hereafter BD. 2. Financial Markets and Corporate Strategy‚ by M. Grinblatt and S. Titman‚ 2nd edition‚ 2002‚ Irwin McGraw Hill. Hereafter GT. I. Introduction to Corporate Finance 1. Corporations
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1979 and 1980. Despite this‚ net income and income from continuing operations both dropped sharply in 1980. Which item on the income statement was most responsible for this drop in income? 2. Why would the Canadian government have any interest in helping Massey-Ferguson refinance its debt? 3. Why would it be difficult for Massey-Ferguson to conduct an equity issue to pay down its debt? You are responsible for handing in written answers to the following questions drawn from the Massey-Ferguson
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| Corporate Finance2 CreditsBU.231.620.62Thursday 6pm – 9pm‚ 10/18/2012--12/13/2012Fall2‚ 2012Columbia‚ Columbia Center‚ 218 | Instructor Shabnam Mousavi Contact Information Phone Number: (410)234-9450 E-mail Address: shabnam@jhu.edu Office Hours Monday/Thursday 10am-noon Required Text and Learning Materials (1) Berk‚ J. and P. DeMarzo. 2007. Corporate Finance. 2nd Edition. Pearson‚ Addison-Wesley with MyLab access. The ISBN is 0-13-295-040-5. (2) Lecture Notes. The lecture
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hotel. A2: Costs and disadvantages for Sunny Beach Hotel - It is necessary an investment for isolation of the area for the karaoke pub and for the kitchinette‚ evaluated between 770‚000 baht (21400 USD) and 1‚000‚000 baht (27800 USD)‚ all works on our expenses. - Disturbances of the hotel activity and possible claims due to noise and safety issues‚ with loss of hotel occupancy especially for family segment of our clients‚ ranging up to 25% of our clients and possible damages to the
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