iTunes Store, App Store, iBookstore, and Mac App Store. The Company sells its products worldwide through its retail stores, online stores, and direct sales force, as well as through third-party cellular network carriers, wholesalers, retailers, and value-added resellers. In addition, the Company sells a variety of third-party iPhone, iPad, Mac and iPod compatible products and various other accessories and peripherals through its online and retail stores. The Company’s business strategy leverages its
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Lecture Notes on Time Value of Money Stefan Arping Amsterdam Business School University of Amsterdam 1 Roadmap • compounding and discounting • annuities and perpetuities • growing annuities and perpetuities • net present value • internal rate of return • real world complexities 2 Compounding • suppose you invest $100 for four years at 10% interest • how does your investment evolve over time? beginning year balance year 1 year 2 year 3 year 4 100.00 110.00 121.00 133.10 interest
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the firm from the point of view of the shareholders. (xiv) Return on Equity and Earnings per Share are one and the same thing. (xv) DU PONT Analysis looks into the elements of profits. (xvi) Ratio Analysis provides the solution to the financial problems. Answers: (i) T, (ii) F, (iii) F, (iv) F, (v) F, (vi) T, (vii) T, (viii) T, (ix) F, (x) F, (xi) T, (xii) T, (xiii) F, (xiv) F, (xv) T, (xvi) F.] 2. Multiple Choice Questions: 1. Accounting Ratios are important tools used by (a) Managers, (b)
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Hi-P International Ltd. Singapore Financial Analysis Finance 101 G11 Group 9 Table of Contents EXECUTIVE SUMMARY 3 INTRODUCTION 4 MACRO-ECONOMIC ANALYSIS 4 INDUSTRY OUTLOOK
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The Basic Tools of Finance TRUE/FALSE 1. If the interest rate is 8 percent, then the present value of $1,000 to be received in 4 years is $735.03. ANS: T DIF: 2 REF: 27-1 NAT: Analytic LOC: The Study of economics, and definitions of economics TOP: Present value MSC: Applicative 2. If a savings account pays 5 percent annual interest, then the rule of 70 tells us that the account value will double in approximately 14 years. ANS: T DIF: 2 REF: 27-1 NAT: Analytic LOC: The Study of economics
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→ → → → → → → → → → → → → → → → → Ⅱ. Time Value of Money 계산법 Ⅱ-1 Time Value of Money의 Work Sheet Time Value of Money를 계산할 때는 계산기의 셋째줄에 있는 Key와 Key 만을 사용하면 됩니다.
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TIME VALUE OF MONEY FUTURE VALUE: What’s a $ today worth in the future. FORMULA: (1+I)N PRESENT VALUE: is a future amount of money that has been discounted to reflect its current value, as if it existed today. FORMULA: 1/(1+I)N LOAN PAYMENT Lump sum: a singel payment "Ordinary annuity - valuing a stream of payments at the end of each period Annuity Due – valuing a
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years only. The appropriate cost of capital is 12% with all equity financing. The borrowing rate is 8% and Raj Corporation will borrow $300000 for the project. The debt must be repaid in two equal instalments. Assume that debt tax-shields have a net value of $0.30 per dollar of interest paid. Calculate the project’s APV. 3. The following table shows the price of a sample of US treasury strips in March 2009. Each strips make a single payment of $1000 at maturity. Maturity | Price (%) | March
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Market Risk Premium = 7.2% …Given, Case Material 3. Risk-free Rate = 5.0% …Given, Case Material 4. Using CAPM, Discount Rate = 5.0% + 1.50X7.2% = 15.8% Appropriate Discount Rate = Cost of Capital = 15.8% Question 2] Value the project using the Adjusted Present Value (APV) approach, assuming the firm raises $750,000 of debt to fund the project and keeps the level of debt constant in perpetuity. Detailed calculations for project’s NPV using APV approach and assuming $750K of debt in perpetuity
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Problem 1. The stock market has historically been a great investment. A reasonable estimate for the historical real annual stock market return is around 7%. Let us suppose that this rate of return is fixed. (a) Use the \Rule of 72" to compute how many years it would take to double the initial amount. Compare with the exact number of years it would take to precisely double the initial amount. When calculating how long will it take for an investment to double, a good approximation is to apply
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