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FINANCE 100 Sections 001, 002, and 003
A. Craig MacKinlay Fall 2012
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Final exams can be picked up at my office (3255 SHDH) on Thursday
January 17th between 1:15 pm and 1:45 pm or between 4:30 pm and 4:45 pm.
Any grade concerns will be addressed after the pick-up date.
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Assignments 1 and 2 can be picked up from the left file cabinet in the
Finance Department (2300 SHDH) across from the TA office.
A check mark on your assignment indicates full credit.
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Required Textbook Options:
Two options are available for the required course text. One choice is
the 9th edition of Corporate Finance which is the edition that is currently
available. A second choice is the new (10th) edition of Corporate Finance.
This edition is now available in the bookstore. Solutions to the end-of-chapter
problems will be made available online.
Important Dates for Fall 2012:
Midterm Exam I: Wednesday, October 3, 2012 - 6:00 pm to 7:30 pm
Midterm Exam II: Wednesday, November 7, 2012 - 6:00 pm to 8:00 pm
Final Exam: Tuesday, December 18, 2012 - 6:00 pm to 8:00 pm
Sample Exams (password required)
Assignments:
Assignment 1 - Each student must hand in her/his own solution.
However, you are allowed to work with a classmate
solving this case.
Due date: Thursday, November 1, 2012
This cover page must be used when handing in your
assignment.
Assignment 1: solution
Assignment 2 - Each student must hand in her/his own solution.
However, you are allowed to work with a classmate
solving this assignment.
Due date: Thursday, November 29, 2012
This cover page must be used when handing in your
assignment.
Data file: f100-data-2012.xls
Teaching Assistants Office Hours
Readings:
Sample Treasury Quotes from WSJ - Bonds and Notes and Bills
Sample US Treasury Quotes from WSJ - Strips
Handouts:
Interest Rate Exercises (not to be handed in)
McKinsey Article on IRR (optional reading)
Practice Capital Budgeting Problem
Statistics Review (For risk-return analysis)
Example of Direct Costs of Financial Distress
Discussion of Indirect Costs of Financial Distress
Capital Budgeting Handout (Nov. 29)
Suggested Problems:
Below are suggested problems from the course text. However, one need
not limit themselves to these problems -- most of the end-of-chapter
problems in the "Questions and Problems" section are appropriate.
Problems for 10th edition of text
Chapter 4 - Discounted Cash Flow Valuation - 3, 4, 6, 12, 13, 15, 26,
27, 28, 30, 34, 41, 52, 56, 57, and 67.
Chapter 8 - Interest Rates and Bond Valuations - 3, 4, 14, 15, 16,
17, and 19. Note that the textbook bond problems
with semi-annual payments give the YTM as an
annual rate compounded semi-annually (ra,2).
Chapter 9 - Stock Valuation - 1, 9, 13, 14, 15, 22, and 24.
End of material for Midterm I
Chapter 5 - Net Present Value and Other Investment Rules -
1, 5, 6, 8, 11, 13, 14, 17, 23, and 28.
Chapter 6 - Making Capital Investment Decisions - 1, 3, 4, 5,
12, 15, 19, 25, and 38a.
Chapter 10 - Risk and Return - 1, 2, 4, 7, 12, 17, and 20.
Chapter 11 - Return and Risk - 2, 3, 5, 6, 9, 10, 12, 16, 24, 26,
30, 31, and 34.
End of material for Midterm II
Chapter 13 - Risk, Cost of Capital, and Capital Budgeting -
1, 3, 5, 10, and 12.
Chapter 14 - Efficient Capital Markets and Behavioral Challenges
- concept questions - 2, 3, 5, 6, 9, and 11
- questions and problems - 2, 3, and 4.
Chapter 16 - Capital Structure: Basic Concepts - 1, 2, 16,
18, and 22.
Chapter 17 - Capital Structure: Limits to the Use of Debt
- 1, 6, and 8.
Chapter 18 - Valuation and Capital Budgeting for the Levered Firm
- 2, 3, 4, 8, and 10.
Chapter 19 - Dividends and Other Payouts - 11, 13, 15, and 18.
Final Exam Material: The content of class lectures is the most
important material. Background reading is in
chapters 13, 14, 16, 17, 18, and 19.
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Problems for 9th edition of text
Chapter 4 - Discounted Cash Flow Valuation - 3, 4, 6, 12, 13, 15, 26,
27, 28, 30, 34, 41, 52, 56, 57, and 68.
Chapter 8 - Interest Rates and Bond Valuations - 2, 3, 13, 14, 15,
16, and 18. Note that the textbook bond problems
with semi-annual payments give the YTM as an
annual rate compounded semi-annually (ra,2).
Chapter 9 - Stock Valuation - 1, 9, 11, 13, 14, 21, and 23.
End of material for Midterm I
Chapter 5 - Net Present Value and Other Investment Rules -
1, 5, 6, 8, 11, 13, 14, 17, 23, and 28.
Chapter 6 - Making Capital Investment Decisions - 1, 3, 4, 5,
12, 15, 19, 25, and 38a.
Chapter 10 - Risk and Return - 1, 2, 4, 7, 12, 17, and 20.
Chapter 11 - Return and Risk - 2, 3, 5, 6, 10, 11, 13, 17, 25, 27,
31, 32, and 35.
End of material for Midterm II
Chapter 13 - Risk, Cost of Capital, and Capital Budgeting -
1, 5, 7, 12, and 14.
Chapter 14 - Efficient Capital Markets and Behavioral Challenges
- concept questions - 2, 3, 5, 6, 9, and 11
- questions and problems - 2 and 3.
Chapter 16 - Capital Structure: Basic Concepts - 1, 2, 16,
18, and 22.
Chapter 17 - Capital Structure: Limits to the Use of Debt
- 1, 6, and 8.
Chapter 18 - Valuation and Capital Budgeting for the Levered Firm
- 2, 3, 4, 8, and 10.
Chapter 19 - Dividends and Other Payouts - 11, 13, 15, and 18.
Final Exam Material: The content of class lectures is the most
important material. Background reading is in
chapters 13, 14, 16, 17, 18, and 19.
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