Chapter 1 1. What is finance * Finance is the study of the flow of money * Borrowing and lending * Financial institutions-the middle man * Financial instruments and markets 2. Fields and jobs in finance * Money and capital market * Markets and institutions that provide short and long term capital: investment banks, banks, mutual funds, insurance companies, stockbrokers * Regulators: Fed, SEC (security and exchange commission) * Investments * Security analysis
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these keystrokes before you begin work on statistical or TVM functions. Please note that your calculator’s sign convention requires that one of the TVM inputs ([PV], [FV], or [PMT]) be a negative number. Intuitively, this negative value represents the cash outflow that will occur in a TVM problem. 1. To set the number of decimal places that show on your calculator: [2nd]→[FORMAT]→{Desired # of decimal places}→[ENTER]→[CE/C] For the exam, I would make sure that the number of decimal places is set to 5
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FINANCIAL ACCOUNTING INFORMATION AND THE RELEVANCE/IRRELEVANCE ISSUE (Global Business & Economics Review Volume 5 No.2 December 2003 pp:140-175) Stanley C. W. Salvary, Canisius College ABSTRACT Some current research conclude that the numbers in financial statements are not relevant for three basic reasons. The numbers: (1) are not isomorphic with capital market values, (2) do not have a future orientation, and (3) are un-interpretable since they are based upon five different measurement attributes
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Net Present Value: Net present value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows. NPV compares the value of a dollar today to the value of that same dollar in the future, taking inflation and returns into account. NPV is calculated using the following formula: NPV= -C0 + C11+r+ C21+r2+…+ Ct(1+r)t - C0 = initial investment C = cash flow r = discount rate t = time If the NPV of a prospective project is positive, the project
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Capital Budgeting Case Business decision involve calculated risks and good understanding of capital budgeting. In the process of deciding to start a new project or to acquire a new business, the focus is usually on the free cash flows measurements, which often are derived from the capital-budgeting proposal. Determining the profitable projects requires comparing the cash flows over a few years, preferably five, where the Net Present Value and the Internal Rate of Return are compared to indicate
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Capital Budgeting Case Mary Stahl QRB/501 February 10, 2014 Gary White Capital Budgeting Case Financial statements will help a company see where there money is going and coming from. This way they can plan for the future. Each statement shows where the money is and how well they are taking care of it. There are income statements, cash flows, net present value (NPV), and Internal Rate of Return (IRR) located in financial statements. To find the NPV and IRR you first need to create an income
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CASES IN FINANCIAL MANAGEMENT SYLLABUS FIN 522 Professor James A. Gentry Cases In Financial Management 343M Wohlers Hall Spring Semester 2009 333-7995 2043 BIF j-gentry@uiuc.edu Office Hours: 10:30 a.m. to 11:45 a.m.
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Remember, the cash flows are estimates and actual cash flows will be different than our estimates. We look at the changes in NPV and cash flows by asking “What if” questions. We will examine some of the methodologies for asking these “What if” questions. The goal is to develop some estimate of the forecasting risk and identify the components that are most critical to the success of a project. When we examine a project with the projected cash flows, we will call this our base case. With the
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you begin work on statistical or Time Value of Money (TVM) functions. Please note that your calculator’s sign convention requires that one of the TVM inputs ([PV], [FV], or [PMT]) be a negative number. Intuitively, this negative value represents the cash outflow that will occur in a TVM problem. 1. To set the number of decimal places that show in your calculator display screen: < f > → {Desired # of decimal places} For the exam, I would make sure that the number of decimal places is set to 5. 2. To
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Case Three CHEF’S TOOLKIT INC. Cash Budgeting 企业现金需求分析和预算 1 Case Explanation: cash budgeting History: Jefferys, invention of Pasta server Production: data Marketing: data Financial Implication: data Data: Composition of Canadian Households; Balance sheet(July 15, 1994) Jefferys Personal balance sheet (July 15, 1994) Production Schedule in Unit 2 Study Questions Q1：What is the Case? (1)event?(2)Companies?(3)Persons?(4)Time? What is the problem?(5)Why is the problem?(6)Possible
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