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FINANCE 100  Section 001-002

A. Craig MacKinlay                                                                                   Fall 2014

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Syllabus

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Important Dates for Fall 2014:

Midterm Exam I:    Thursday, October 2, 2014 - in class

Midterm Exam II:    Thursday, November 6, 2014 - in class

Final Exam:   Friday, December 12, 2014 - 6:00 pm to 8:00 pm

 

 

Sample Exams (password required)

 

Readings:

Term Structure Appendix

 

Interest Rate Exercises (not to be handed in)

   Solutions

 

 Common Stock Valuation

  Solution

Practice Capital Budgeting Problem

 Solution

Statistics Review (For risk-return analysis)

 

Example of Direct Costs of Financial Distress

Discussion of Indirect Costs of Financial Distress

 

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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, October 30, 2014

     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, December 4, 2014

    This cover page must be used when handing in your

      assignment.

    Data file:    f100-data-2012.xls

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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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Teaching Assistants Office Hours (begin Tuesday September 8)

 

 

 

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