FIN335 Fall 2012
Phase 3 Exam Review
Chapters 2, 13, 14, 17
Supplementary Materials on
Bankruptcy, M&A
42 Questions [MC/TF] , 6 Problems
Chapter 2
Financial Markets & Institutions
1.
2.
3.
4.
5.
6.
7.
How do primary markets differ from secondary
markets?
How do stock splits affect post split prices (P)
What effects do increases in debt use have on ROE?
EPS?
Why would a firm do a reverse split?
How do Hedge funds differ from regular mutual
funds?
How do money markets differ from capital markets?
What are derivatives? How are the valued?
Chapter 13
Leverage and Capital Structure
1. What is the essence of Modigliani & Miller
Proposition 1?
2. How do taxes affect the cost of debt?
3. How does financial leverage differ from
operating leverage?
4. What is the breakeven point and how is it
calculated? (P)
5. What is the objective of capital structure
startegy?
Chapter 14
Dividends and Dividend Policy
1. What are the 4 important dates regarding
the payment of dividends?
2. What does it mean when a stock goes exdividend? (P)
3. How do stock splits affect shareholder
wealth? (P)
4. How do dividends relate to stock prices?
5. What are dividend clienteles?
Chapter 17
International Financial Management
1. How does a direct exchange differ from
an indirect exchange? (P)
2. How can we compute a cross rate for a
third given two cross rates? (P)
3. How does a spot trade differ from a
forward?
4. How do floating rates differ from
Managed rates? Which is more popular?
5. What are Eurodollar deposits?
Supplementary Material
1. Bankruptcy and Reorganization
(Supplementary Notes)
a.
b.
c.
What are the various definitions of financial
distress?
What does it mean to reorganize a firm in
bankruptcy?
How does the Rule of Absolute Priority work?
Supplementary Material
1. Mergers and Acquisitions
a. What is synergy in a merger/acquisition?
b. What is an LBO?
c. What is a white knight defense?