FNCE10002 Principles of Finance Semester 1 2020

Sample Final Examination 1 – LMS Version 1 of 2

Formula Sheet Page 1 of 2

0 (1 )nFV PV n r   0 (1 )
nFVPV
n r
  
0 (1 )
n
nFV PV r  0 (1 )
n
n
FVPV
r
 
0
CPV
r
  0
1
1 n
CPV
r r
         

PV0(OA) = 11
(1 )n
C
r r
         FVn(OA) = (1 ) 1
nC r
r
       
   0
1( ) 1 1
1 n
CPV AD r
r r
          
   ( ) 1 1 1nn CFV AD r rr
          
1
0
CPV
r g
   
1
0
(1 )( ) 1
1
n
n
C gPV GA
r g r
            

   
1 (1 )( ) 1 1
1
n
n
n n
C gFV GA r
r g r
             
1 1
k
e
rr
k
     
re = er – 1 0 [1 ( / 365) ]
n
D
FP
n r
  
0 (1 )
n
n
D
FP
r
  0
11
(1 ) (1 )
n
n n
D D D
FCP
r r r
            

   0 1 1 1
n
t n
t n
t E E
D PP
r r
   1 1n n nE n n
D P Pr
P P
   
1n
n
E
DP
r g
 
1n
E
n
Dr g
P
 
1n
E
n
Dg r
P
  0
1 E
P
E r g
 
0
0
(1 )
E
P g
E r g
  
1
1
t t t
t
t
P D PR
P


 
1
1
t t t
t
t
P C PR
P


  ത ൌ ሺଵ ൅ ଶ ൅⋯൅ ்ሻ/
ത௚ ൌ ሾሺ1 ൅ ଵሻሺ1 ൅ ଶሻ… ሺ1 ൅ ்ሻሿଵ/் െ 1 E(r) = p1R 1 + p2R 2 + ... + pnRn
Var(r) or 2 = p1[R1 – E(r)]2 + ... + pn[Rn – E(r)]2 SD(r) = 
12 = p1[r11 – E(r1)][r21 – E(r2)] + ... +
pn[r1n – E(r1)][r2n – E(r2)]
12
12
1 2
  
12 1 2 12    E(rp) = w1E(r1) + w2E(r2)
2 2 2 2 2
1 1 2 2 1 2 122p w w w w      2 2 2 2 21 1 2 2 1 2 1 2 122p w w w w       


FNCE10002 Principles of Finance Semester 1 2020

Sample Final Examination 1 – LMS Version 2 of 2

Formula Sheet Page 2 of 2

σp2 = σ2/N + [(N – 1)/N]σjk E(rj) = rf + [E(rm) – rf]j
2
jm
j
m
 
j
j jm
m
  
    

p = x11 + x22 S = [E(rp) – rf]/σp
T = [E(rp) – rf]/βp A = rp – [rf + [E(rm) – rf]βp]
  01 1
N
t
t
t
CNPV I
r
    010 1
N
t
t
t
CNPV I
IRR
  
PI = NPV/I0 Ct = (Rt – OCt)(1 – tc) + tcDt
(1 + r) = (1 + rr)(1 + i) 0 (1 ) (1 ) 1
N
N
rNPV NPV
r
     

O D E P
D E Pr r r r
V V V
                  ' (1 )O D c E P
D E Pr r t r r
V V V
                   
VU = EBI/rO EL = (EBI – Interest)/rE
DL = Interest/rD VL = EL + DL
 E O O D Dr r r r E
        E O O D
D
E
          

VL = VU + tc×D VL = VU + PV(TS) – PV(BC + AC)
X + mP1 = nD1 + I V0 = [(n + m)P1 – I + X]/(1 + rE)
Call option payoff = Max(ST – X, 0) Call option profit = Max(ST – X, 0) – C
Put option payoff = Max(X – ST, 0) Put option profit = Max(X – ST, 0) – P