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Frequently Asked Questions
  • Home
  • Contact Us
  • Online Course
    • 3D Printing Applications
    • Accounting: Principles of Financial Accounting
    • Amazon DynamoDB: Building NoSQL Database-Driven Applications
    • Analyzing Big Data with SQL Quiz Answer
    • Android App Components – Intents, Activities, and Broadcast Receivers
    • Android App Components – Services, Local IPC, and Content Providers
    • API Development on Google Cloud’s Apigee API Platform
    • Applied AI with DeepLearning
    • Artificial Intelligence
    • Big Data, Artificial Intelligence, and Ethics
    • Blockchain and Cryptocurrency Explained
    • Build Your First Android App Quiz (Project-Centered Course)
    • Career planning: resume/CV, cover letter, interview
    • Computer Architecture
    • Cost and Economics in Pricing Strategy
    • Customer Value in Pricing Strategy
  • All Assignments
    • Week 5 Assignments of Data Warehouse Concepts Design and Data Integration
    • Peer graded Assignment Personas Problem Scenarios and Propositions and User Stories
    • Peer-graded Assignment: Positioning Statement & Focal Questions
    • Peer-graded Assignment: Creating and Testing a Demand/Value Hypothesis
    • Supply Chain Logistics Week 4 Peer-Graded Assignment Image Link:
    • Week – 4 Peer-graded Assignment: Build a Logistics Network
    • Supply Chain Logistics Week 2 Peer-Graded Assignment Image
  • Free Course
    • The 48 Best Free Online Spanish Courses To Learn
    • 53 Best Free Anatomy And Physiology Online Accredited Courses In 2021
    • Free Certification Course By Academy Europe
    • Top Free Certification Course By Eduonix
    • Top Free Course On Data Science By Harvard
    • All Udemy Free Certification Courses
    • Top Stanford university Free Courses

Understanding Financial Markets

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What is the terminal value (in Year t+3)? Please give your answer in million USD and round it to the nearest integer. For example, if your answer is 3088 million USD, then type in “3088”.
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Suppose the correct Terminal Value is 6000 million USD (i.e. discard your answer to the previous question), what is the price of 1 share of XYZ using the Discounted Cash Flow (DCF) valuation method?
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Suppose you observe that a share of XYZ is traded at a price of 35 USD on an exchange. Based on your own estimate of the price of a share of XYZ, would you say that the company is overvalued or undervalued by the market (use the price for one share that you found in the previous question to answer this question)?
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You are now contemplating the following project: buying 1 share of XYZ today at 35 USD on the exchange. What is the Net Present Value (NPV) of this project?
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Given your answer to the previous question, what would you say about this project?
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Of course, you also know about the multiples-based valuation method. You would like to use this method to verify if your conclusion regarding the overvaluation or undervaluation of XYZ is correct.
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Does this new price estimate (i.e. the one you got in the previous question) change your conclusion regarding the undervaluation or overvaluation of XYZ by the market (i.e. does it change your answer to Question 4)?
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Suppose you have found a lower value for the price of a share of XYZ using the multiples-based method than the DCF method. Given this discrepancy, you are looking for errors you could have made in your forecasts using the DCF method.
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You meet the following 4 investors and each have their own beliefs:
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Which of the following statements regarding hedge funds are true?
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