FIN 401 Study Guide - Final Guide: Ntime, Net Present Value, Risk-Free Interest Rate

• School: Ryerson University
• Department: Finance
• Course: FIN 401
• Professor: Scott Anderson

Document Summary

Goal seek set cell(cell we want) to value by changing b)synergies/value of bidder / npv. P/s=(total value of equity-acquisition cost)/#shares: capital structure. Pv of cca= [c. d. t]x[1+0. 5r]/[r+d]x[1+r] [s. d. t]/[r+d]x[(1+r)^n] d-cca rate ; r-discount rate / n-time to zero. Wacc=e/v . re+ d/v . rd(1-t: mergers and acquisitions, fcf method b) fcfe=fcf after tax int+ change in debt. Fcf= nopat-net invt in opr capital (no depr) (opr c opr l)+change in l. t. a. Funds+firm"s expenses/ ( 1- commission: residual dividend policy, max. >debt to asset ratio - > amount received amount wanted=amount needed. We use present value of shares at time 1!!: forward vs future swaps. Int paid to bank originally + new int bank gave you=total interest. Futures: total sale b/b per contract= x future contracts. Always use a contract that expires after you sell or buy. Profit or loss = (current price-contract price)*future contracts*things. Current position=current oil price*total sale p(l) on contract: real options, cf=probabity good*cf of the good.