I have questions if sombody can help that might help you too....
here is couple question here first to see how we can do?

1. Risk can be viewed as(In the terms of finance..)
a. the degree of variability of return
b. the standard deviation of the probability distribution of return
c. the chance that return will be less than expected
d. a value neutral concept
e. all of the above

2. The security market line( in finance term)
a. relates an individual security's return to the returns of other securities in the same industry.
b. provides a picture of the risk-return tradeoff required by diversified investors
c. has as its slope the beta of the security
d. none of the above

3. A stock has an expected return of 10% and a variance of 25%. Its coefficient of variation is:
a. 2.5
b. .4
c. .5
d. 2.0

4. The only component of the CAPM equation that relates specifically to a company is:
a. bX
b. kM
c. kRF
d. (kM - kRF)

find the correct answer, i will find it as well

here is what i got nepali_kancha.

1.c interest is paid regularly during the term, usually semiannually, whereas repayment of principal does not occur until the maturity date...
2.c, i think default risks do debt ratings specifically measure
3.d
4.d
5.d
6. concfused on this question i would say answer b

here is couple problem i was confused to get exact IRR, may be method that i did wrong.

1. The projected cash flows for two mutually exclusive projects are as follows:

Year : 0
Project A=($150,000)
Project B= ($150,000)
Year :1
Project A = 0
Project B = 50,000
Year :2
Project A = 0
Project B =50,000
Year :3
Project A = 0
Project B =50,000
Year :4
Project A= 0
Project B =50,000
Year :5
Project A =250,000
Project B=50,000

If the cost of capital is 10%, the decidedly more favorable project is:

a. project B with an NPV of $39,539 and an IRR of 19.9%
b. project A with an NPV of $5,230 and an IRR of 10.8%
c. project A with an NPV of $39,539 and an IRR of 10.8%
d. project B with an NPV of $5,230 and an IRR of 19.9%

2. The following projects are all characterized by a single initial cash outflow (the initial investment) followed by a series of cash inflows. Rank them based on profitability index.

Project A
Investment:$160,000
NPV: $30,000

Project B
Investment: $120,000
NPV $15,000

Project C
Investment:$110,000
NPV:$25,000

Project D
Investment: $200,000
NPV: $40,000

a. A, C, B, D
b. C, D, A, B
c. D, A, C, B
d. B, D, C, A

here is couple problem i was confused to get exact IRR, may be method that i did wrong.

1. The projected cash flows for two mutually exclusive projects are as follows:

Year : 0
Project A=($150,000)
Project B= ($150,000)
Year :1
Project A = 0
Project B = 50,000
Year :2
Project A = 0
Project B =50,000
Year :3
Project A = 0
Project B =50,000
Year :4
Project A= 0
Project B =50,000
Year :5
Project A =250,000
Project B=50,000

If the cost of capital is 10%, the decidedly more favorable project is:

a. project B with an NPV of $39,539 and an IRR of 19.9%
b. project A with an NPV of $5,230 and an IRR of 10.8%
c. project A with an NPV of $39,539 and an IRR of 10.8%
d. project B with an NPV of $5,230 and an IRR of 19.9%

2. The following projects are all characterized by a single initial cash outflow (the initial investment) followed by a series of cash inflows. Rank them based on profitability index.

Project A
Investment:$160,000
NPV: $30,000

Project B
Investment: $120,000
NPV $15,000

Project C
Investment:$110,000
NPV:$25,000

Project D
Investment: $200,000
NPV: $40,000

a. A, C, B, D
b. C, D, A, B
c. D, A, C, B
d. B, D, C, A

you guys study this in MBA? No shit, man. It looks like so easy stuff.

"Math Graduate Student"
surprised to see one liner answers in a grad level classes

Storm..
1. A
2. B

exact NPV and IRR for project B are: $39,539.34 (NPV) and 19.8577 (IRR)

NB: Pire good for you :o)

wit's thanks, let me ask you for the question 2, how i understood is percentage of NPV in the investmet compare with other and rank, is that correct ?

You are welcome..and right about # 2
Profitibility Index (PI) = NPV/Total Investment + 1
Project A = 30/160 + 1 = 1.1875
Project B = 15/120 + 1 = 1.125
Project C = 25/110 + 1 = 1.227
Project D = 40/200 + 1 = 1.20

note: if PI is < 1, then project's NPV will be negative.

thanks, i am cleared now, i was just looking at the other way not by the book....... i got it....
Here is few others lets see.

1. What type of option is the right to purchase stock at a fixed price for a specified period?
a. flexibility option
b. financial option
c. legal option
d. timing option

2. The appropriate interest rate to use in capital budgeting is
a. always the company's cost of capital
b. is the company's cost of capital if the project's risk is about the same as the company's
c. the cost of capital plus any additional risk premium required to compensate for the project's higher risk
d. b and c

3. A company's cost of capital is the most appropriate discount rate to use when analyzing which type of project(s)?
a. replacement projects
b. expansion projects
c. new venture projects
d. replacement and expansion projects
e. expansion and new venture projects

4. Multidivisional firms are often unable to obtain an appropriate surrogate for determining the beta of a division. An acceptable alternative technique is to develop a beta through the division's accounting records. This is accomplished by:
a. regressing the division's projected return on equity against the return on a major company in a similar business
b. regressing the division's accounting return on equity in previous years against the return on a major stock market index
c. regressing the division's projected return on equity against the historic return on a major stock market index
d. none of the above

5. When a similar company can't be found to use in estimating a divisional beta, the division's own records can sometimes be used instead. This method is called
a. pure play
b. CAPM
c. accounting beta
d. financial accounting

1. B
2. D
3. A ( believing that rest of the projects reequire an indepth analysis)
4. B (If you ignore the subtle difference between ROE and ROA) if not D
5. C
hope this helps

Thanks again wit's, For the question 4, B is correct(that is what u got) where accounting beta method is accomplished by regressing historical values of division's return on equity against the return on a major stock market index.

I will go over and if i find any thing i will bring it... Good night.

Here is few question...

1. If a firm adopts a large proportion of above-average-risk projects that are not offset by below-average-risk projects
a. its cost of capital will rise.
b. its risk premium will decline.
c. the risk-free rate will increase as more risk is added.
d. none of the above

2. Which of the following is/are included in the list of drawbacks to using the Monte Carlo simulation for dealing with risk in capital budgeting?
a. Cash flows still have to be estimated subjectively
b. Individual cash flows generally don't behave independently. If one cash flow turns out to be less than expected, several other may behave the same way.
c. Even after creating a distribution of probably outcomes, it is difficult to know exactly how to interpret the data.
d. Both a. and c. are drawbacks.
e. All of the above are drawbacks.

3. The probability of a path is the product of all the branch probabilities along it and is called a
a. joint probability
b. conditional probability
c. basic probability
d. none of the above

4. In calculating probabilities using a decision tree, which of the following is most correct?
a. The probabilities emerging from any node must sum to 1.
b. The ultimate probabilities assigned to each of the branches (looking at the right hand side of the tree) must sum to 1.
c. The probability assigned to any given branch (looking at the right hand side of the tree) can be no greater than .5.
d. Both a. and b. are correct.
e. All of the above are correct.

5. A land option contract is considered what type of option?
a.expansion option
b. investment timing option
c. flexibility option
d. abandonment option

KE HO STORM BRO HOMEWORK GARNE PHURSAD CHHAINA KI KASO?
SAJHABASI LAI HW GARNA LAGAYERA AFU KAM MA BYASTA HOKI KASO??
I WISH I COULD TAKE A TIME READ YOUR STUFF.
THE SEMESTER IS GOING CRAZY. IF I HAVE PROBLEM I WILL POST IT HERE TOO.

purush bro, thanks for ur comment, you are welcome to bring the post...just think positive.
And i see that you are looking for the job...i will let you know when i find something...