This exam is timed and must be completed in 3 hours. I may split this exam into two parts do to time constraints. I have attached the chapters that the exam will cover along with homework problems. See below for exam details. Please show ALL work. You may use Excel or anything else.
It consists of five questions, each with sub-parts, and covers chapters 1, 5, 8, and 10. Marks are allocated as follows: chapter 1 (conceptual – goal of financial management, executive compensation, agency issues: 35 points), chapter 5 (calculations – PV, FV, annuities, uneven cash flows: 40 points), chapter 8 (calculations – historical returns, holding period returns, average returns, required returns using CAPM: 25 points; conceptual – measures of risk: 20 points), and chapter 10 (conceptual – basic understanding of cost of capital concepts: 10 points; calculations: estimate WACC using information on different capital components: 30 points). Total points available: 160 points. You have three hours to complete the exam but must do so in one sitting.
You may find it easier to complete the chapter 5 (TVM) and chapter 8 (risk and return) problems in Excel or any other spreadsheet software. If you do so, please submit your spreadsheet.