Consider a bond with a 10% coupon and with yield to maturity = 8%. If the bond’s yield to maturity remains constant‚ then in 1 year the bond’s price will be: a. Higher b. Lower c. Unchanged d. Cannot answer based on given information Question 2 The yield to maturity on a bond is: a. Below the coupon rate when the bond sells at a discount‚ and above the coupon rate when the bond sells at a premium. b. The discount rate that will set the present value of the payments equal to the bond price
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Study notes By Zhipeng Yan Corporate Finance Stephen A. Ross‚ Randolph W. Westerfield‚ Jeffrey Jaffe Chapter 1 Introduction to Corporate Finance ..................................................................... 2 Chapter 2 Accounting Statements and Cash Flow.............................................................. 3 Chapter 3 Financial Markets and NPV: First Principles of Finance................................... 6 Chapter 4 Net Present Value....................................
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purchasing power provided by the 10 billion‚ then your increased ability to purchase goods must be offset by a decrease in the ability of others to purchase goods. Thus‚ the other individuals in the economy can be made worse off by your discovery. 2. a. The bank loan is a financial liability for Lanni. (Lannis IOU is the banks financial asset). The cash Lanni receives is a financial asset. The new financial asset created is Lannis promissory note (that is‚ Lannis IOU to the bank). b. Lanni transfers
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Corporate Finance Syllabus Spring 2009 Prof. Anna Scherbina UC Davis Graduate School of Management Office: 126 AOB IV Tel: 530.754.8076 e-mail: ascherbina@ucdavis.edu Course Focus We will explore how corporations make financial decisions through the analysis of Harvard Business School cases. Should a firm undertake a new investment opportunity‚ raise equity‚ acquire another firm‚ or conduct an IPO? How should small firms manage their working capital? How fast should a firm grow
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completed for an after-tax payment of $30 million. QUESTIONS 1. Tom believes the company should use the extra cash to pay a special one-time dividend. How will this proposal affect the stock price? How will it affect the value of the company? 2. Jessica believes
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Prebooked assistance Passengers travelling with checked baggage must present themselves at the baggage drop desk no later than 40 minutes before the scheduled departure time of the flight. Passengers with assistance must arrive at the airport 2 hours before departure. NONEU / EEA PASSENGERS MUST PROCEED TO CHECKIN FOR DOCUMENT CHECK AND VISA VERIFICATION. NonEU passport holders: according to EU Regulation 610/2013‚ a third country national‚ who intends a short stay‚ must be in possession of a valid document
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1. Which one of the following is a means by which shareholders can replace company management? A. stock options B. promotion C. Sarbanes-Oxley Act D. agency play E. proxy fight 2. Decisions made by financial managers should primarily focus on increasing which one of the following? A. size of the firm B. growth rate of the firm C. gross profit per unit produced D. market value per share of outstanding stock E. total sales 3. Which one of the following is the financial statement that
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Company has a separate legal entity from its members‚ can sue or be sued on its own behalf. As illustrated in Foss v Harbottle (1843)‚ the proper plaintiff is the company itself. In other words‚ directors have the power to decide whether or not to sue in protection of the company. However‚ very often‚ the persons who commit misconduct are the major controller of the company and improbable to permit the company to sue. A common law right is therefore reserved for shareholders to sue the wrongdoers
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CHAPTER 1 Goals and Governance of the Firm Answers to Problem Sets 1. a. real b. executive airplanes c. brand names d. financial e. bonds f. investment g. capital budgeting h. financing 2. c‚ d‚ e‚ and g are real assets. Others are financial. 3. a. Financial assets‚ such as stocks or bank loans‚ are claims held by investors. Corporations sell financial assets to raise the cash to invest in real assets such as plant and equipment. Some
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(Round your answers to 2 decimal places. (e.g.‚ 32.16)) Current ratio 2011 1.64 times 2012 1.75 times b. Calculate the quick ratio for each year. (Round your answers to 2 decimal places. (e.g.‚ 32.16)) Quick ratio 2011 0.55 times 2012 0.61 times c. Calculate the cash ratio for each year. (Round your answers to 2 decimal places. (e.g.‚ 32.16)) Cash ratio 2011 0.16 times 2012 0.17 times d. Calculate the NWC to total assets ratio for each year. (Round your answers to 2 decimal places. (e.g.
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