Business & Finance homework help.  

  1. Definitions. Define any 10 terms, and provide examples.

Risk                                 Beta                                Market premium
Capital structure               Preemptive rights             Dividend yield
Flotation costs                  Dividend                          ex dividend
Repurchase                      Required return                Recapitalization
Stock splits                      Expected return                Operating working
Dividend payout               cash conversion cycle               capital
Free Cash Flow                 Market risk premium

  1. Essay Questions. Answer the question below.  Please be sure to complete all parts of the question.


  1. a) What is Weighted Average Cost of Capital ?

Explain and derive each component part.

  1. b) Utilizing the company that you have analyzed, estimate its WACC.
  2. c) What is capital budgeting ?
  3. d) What is a target capital structure ?
  4. e) Derive the Net Present Value methodology of capital budgeting, and explain the use of WACC.

III.  Additional Essay Questions.  Answer any two questions.  Please be sure to complete all parts of each question that you select.

  1. Regarding equities (stock):
  2. What is stand-alone risk ?
  3. How is it measured ?  Create an example and compute the risk


  1. What is market risk ?

(1) What is the connection of a stock to market risk ?
(2) Define and provide the formula to determine a stock’s market

  1. a)  What is an Investment portfolio ?
  2. b) Using historical data:  create a portfolio, and solve for the portfolio’s

average, annual return.
[Suggestion:  Pick  4 – 10 different companies to comprise the

  1. c) How would we measure the risk of the PORTFOLIO /
  2. d) What is the  conclusion of the  Capital Asset Pricing Model with regard

to a portfolio ?
What are the important conclusions that this model offers
regarding investment portfolios ?

  1. a)  Why must working capital be “managed” ?
  2. b) What is (are) the goal(s) of working capital management ?
  3. c)  Create an example and explain the Cash Budget.
  4. d) How is a Cash Budget distinct from an Income Statement ?
  5. e) What are some techniques that a company may undertake to

improve its working capital position ?

Business & Finance homework help