FINAL EXAM

1
 Chapter 1

What do you need to know?

- The difference between simple and compound interests.

- How to compare 2 cash flow sequences available at different dates.

- How to convert an annual interest rate into a monthly rate.

What are the formulas given at the exam?

−n
( 1+i )n − 1 1 − ( 1+i )
F V = Annuity × P V = Annuity ×
i i
 Chapter 2

What do you need to know?

- The NPV decision rule.

- The payback investment rule.

- The IRR investment rule.

- How to calculate a cash flow for an investment project.

What are the formulas given at the exam?

L inear interpolation formula=i1 + ( i 2 −i 1 ) × ¿ ¿

 Chapter 3
What do you need to know?

- How to repay a loan.

- How to calculate the OER of a loan for individuals.

- How to calculate the after tax cost of a loan for a firm.

- How to calculate the theoretical price of a bond

- How to calculate the YTM of a bond

What are the formulas given at the exam?

C×i
A nnuity = −n
1 − ( 1+i )
 Chapter 4

What do you need to know?

- What a capital increase with PSRs is and its consequences on shareholder wealth

- How to use the gordon and shapiro model

- How to use the PER

- How to use the CAPM formula

What are the formulas given at the exam?

𝑛 × 𝑃0+ 𝑃𝑖 𝑃 0 − 𝑃 𝑖 𝑃1 − 𝑃 𝑖
𝑃 1= 𝑃   𝑃𝑆𝑅 =𝑃 0 − 𝑃 1= =
𝑛+1 𝑛+1 𝑛
 Chapter 5

What do you need to know?

How to use the DCF methodology to value a firm.

What are the formulas given at the exam?

The different steps of the DCF methodology are given