Using Hamada's Equation to lever and Unlever Beta to use in computing cost of equity in CAPM to compute the cost of capital; this is especially important if you have an industry beta but the firm or project will use a different debt-equity ratio than that of the industry
Views: 4302 Elinda Kiss
calculation of cost of debt (after taxes), cost of common equity and using them in the WACC equation
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Future Value of an Annuity -- calculation in excel Future Value of an Ordinary Annuity
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what are the determinants of interest rates? What influences interest rate levels?
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Sensitivity analysis measures the effect of changes in one variable on the project’s NPV.
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Time Value of Money; calculation of Number of Periods
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how to calculate Yield to Maturity of a Coupon paying bond How to calculate Yield to Call of a Coupon paying bond that is callable
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calculation of a bank's duration gap with more than one asset and more than one liability. calculation of duration of the assets of a bank. calculation of the duration of the liabilities. impact of a relative change in interest rates on the market value of the equity.
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if sell an asset before it is fully depreciated, how does that affect project's end of life cash flows and free cash flows?
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determining the prediction interval for a return calculation when the returns are normally distributed
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contrasting independent risk and common (Systematic) risk firm specific risk vs. risk that affect all stock in the market
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how do we calculate free cash flow what are operating cash flows how is net working capital treated in the capital budgeting analysis? what is net working capital?
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Price risk is the concern that rising yield (interest rate) will cause the value of a bond to fall. The longer duration bond (longer maturity and lower coupon rate) will have more price risk than the shorter duration bond. Reinvestment rate risk is the concern that yield will fall, and future CFs will have to be reinvested at lower rates.
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Capital Budgeting, using straight line depreciation to compute NPV and IRR
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when combine stocks in a portfolio, can diversify away the unique firm specific risk and be left with systematic, common market risk
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Risks, banks, financial institutions, interest rate risk, refinancing risk, reinvestment risk, market risk, credit risk, technology risk, operational risk, , off-balance sheet risk, sovereign risk, liquidity risk, insolvency risk, risk of changing regula
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Discounted Free Cash Flow model connection to capital budgeting Free cash flow is the sum of the free cash flows from the firm’s current and future investments, so enterprise value is the sum of the present value of existing projects and the NPV of future new ones. NPV of any investment represents its contribution to the firm’s enterprise value.
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Duration Duration Definition Duration Calculation Modified Duration
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calculation of Present Value, Future Value, Number of Periods, Payment, Rate, and Net Present Value on a Series of Cash flows, using excel
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present value of a single future payment and present value of an ordinary annuity calculation in excel
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Basel III leverage ratio capital ratio counter cyclical buffer liquidity coverage ratio
Views: 266 Elinda Kiss