COMM 122- Midterm Exam Guide - Comprehensive Notes for the exam ( 19 pages long!)

• School: Queen's University
• Department: Commerce
• Course: COMM 122
• Professor: Evan Dudley

Document Summary

How many mexican pesos can you get for one euro? (cid:1839)(cid:1857)(cid:1876)(cid:1855)(cid:1853)(cid:1866) (cid:1857)(cid:1871)(cid:1867)(cid:1871) (cid:1831)(cid:1873)(cid:1870)(cid:1867)(cid:1871) =(cid:883)(cid:884). (cid:886)(cid:883)(cid:891)(cid:886) (cid:1857)(cid:1871)(cid:1867)(cid:1871) (cid:883) (cid:1847)(cid:1845) (cid:882). (cid:889)(cid:891)(cid:890)(cid:882) (cid:1831)(cid:1873)(cid:1870)(cid:1867)(cid:1871) (cid:883) (cid:1847)(cid:1845) Distributing prohibited | downloaded by henry tian (henry_t@live. ca) lomoarcpsd. K(cid:1857) (cid:3045)(cid:3021)= continuous compounding (i. e. apr, ear) (cid:4666)(cid:2869)+(cid:3045)(cid:4667) = discrete compounding. Solving for exchange rate directly using irrp: (cid:3004)(cid:3005)(cid:3015)(cid:4666)(cid:1872)(cid:4667)=(cid:1845) (cid:4666)(cid:1872)(cid:4667) (cid:3022)(cid:4666)(cid:1872)(cid:4667) (cid:883)+(cid:1866)(cid:1858)(cid:3004)(cid:3005)(cid:3015) (cid:883)+(cid:1866)(cid:1858)(cid:3022) (cid:883)=(cid:1845) (cid:4666)(cid:1872)+(cid:883)(cid:4667) (cid:1845) (cid:4666)(cid:1872)(cid:4667) (cid:883)+ (cid:883)+ =(cid:1832)(cid:4666)(cid:882),(cid:883)(cid:4667) (cid:1845)(cid:4666)(cid:882)(cid:4667) (cid:1831)(cid:4666)(cid:1845)(cid:3021)(cid:4667)=(cid:1845)(cid:2868) [(cid:4666)(cid:883)+(cid:4667) (cid:4666)(cid:883)+ (cid:4667)](cid:3021) lomoarcpsd. Distributing prohibited | downloaded by henry tian (henry_t@live. ca) Suppose now that cheek products already has m in debt outstanding that pays interest at a fixed rate of 5% per year. Assume that the plan to borrow additional debt, the interest on the new debt, and the long-run target debt equity ratio under the lbo remain unchanged. Now, utilizing the apv method, we can calculate the total value of the firm with debt included.