SOLUTION MANUAL FOR
| | |
Principles Of Corporate Finance
| | | |
14th Edition By Richard Brealey, Stewart Myers, ALL
| | | | | | |
| Chapters (1 - 34)| | |
, TABLE OF CONTENTS
| |
Chapter |1: |Introduction |to |Corporate |Finance
Chapter |2: |How |to |Calculate |Present |Values
Chapter |3: |Valuing |Bonds
Chapter |4: |Valuing |Stocks
Chapter |5: |Net |Present |Value |and |Other |Investment |Criteria
Chapter |6: |Making |Investment |Decisions |with |the |Net |Present |Value |Rule |
Chapter |7: |Introduction |to |Risk, |Diversification, |and |Portfolio |Selection
Chapter |8: |The |Capital |Asset |Pricing |Model
Chapter |9: |Risk |and |the |Cost |of |Capital
Chapter |10: |Project |Analysis
Chapter |11: |How |to |Ensure |That |Projects |Truly |Have |PositiveNPVs |
Chapter |12: |Efficient |Markets |and |Behavioral |Finance
Chapter |13: |An |Overview |of |Corporate |Financing
Chapter |14: |How |Corporations |Issue |Securities |
Chapter |15: |Payout |Policy
Chapter |16: |Does |Debt |Policy |Matter?
Chapter |17: |How |Much |Should |a |Corporation |Borrow?
Chapter |18: |Financing |and |Valuation |
Chapter |19: |Agency |Problems |and |Corporate |Governance
Chapter |20: |Stakeholder |Capitalism |and |Responsible |Business |
Chapter |21: |Understanding |Options
Chapter |22: |Valuing |Options
Chapter |23: |Real |Options |
Chapter |24: |Credit |Risk |and |the |Value |of |Corporate |Debt
Chapter |25: |The |Many |Different |Kinds |of |Debt
Chapter |26: |Leasing
Chapter |27: |Managing |Risk
Chapter |28: |International |Financial |Management |
Chapter |29: |Financial |Analysis
Chapter |30: |Financial |Planning
Chapter |31: |Working |Capital |Management
Chapter |32: |Mergers
Chapter |33: |Corporate |Restructuring |
,Chapter |34: |Conclusion: |What |We |Do |and |Do |Not |Know |about |Finance
CHAPTER |1
Introduction |to |Corporate |Finance
The |values |shown |in |the |solutions |may |be |rounded |for |display |purposes. |However, |the |answers |were
|derived |using |a |spreadsheet |without |any |intermediate |rounding.
Answers |to |Problem |Sets
1. a. real
b. executive |airplanes
c. brand |names
d. financial
e. bonds
*f. investment |or |capital |expenditure
*g. capital |budgeting |or |investment
h. financing
*Note |that |f |and |g |are |interchangeable |in |the |question.
Est |time: |01-05
2. A |trademark, |a |factory, |undeveloped |land, |and |your |work |force |(c, |d, |e, |and |g) |are |all |real |assets.
|Real |assets |are |identifiable |as |items |with |intrinsic |value. |The |others |in |the |list |are |financial
|assets,|that |is, |these |assets |derive |value |because | of |a |contractual |claim.
Est |time: |01-05
3. a. Financial |assets, |such |as |stocks |or |bank |loans, |are |claims |held |by |investors.
|Corporations |sell |financial |assets |to |raise |the |cash |to |invest |in |real |assets |such |as
|plant|and |equipment. | Some |real |assets |are |intangible.
b. Capital |expenditure |means |investment |in |real |assets. |Financing |means |raising |the | cash
|for |this |investment.
, c. The |shares |of |public |corporations |are |traded |on |stock |exchanges |and |can |be |purchased
|by |a |wide |range |of |investors. |The |shares |of |closely |held |corporations |are |not | publicly
|traded |and |are | held |by |a |small |group |of |private |investors.
d. Unlimited |liability: |Investors |are |responsible |for |all |the |firm‘s |debts. |A |sole |proprietor |has
|unlimited |liability. |Investors |in |corporations |have |limited |liability. |They |can |lose |their
|investment, |but |no |more.
Est |time: |01-05
| | |
Principles Of Corporate Finance
| | | |
14th Edition By Richard Brealey, Stewart Myers, ALL
| | | | | | |
| Chapters (1 - 34)| | |
, TABLE OF CONTENTS
| |
Chapter |1: |Introduction |to |Corporate |Finance
Chapter |2: |How |to |Calculate |Present |Values
Chapter |3: |Valuing |Bonds
Chapter |4: |Valuing |Stocks
Chapter |5: |Net |Present |Value |and |Other |Investment |Criteria
Chapter |6: |Making |Investment |Decisions |with |the |Net |Present |Value |Rule |
Chapter |7: |Introduction |to |Risk, |Diversification, |and |Portfolio |Selection
Chapter |8: |The |Capital |Asset |Pricing |Model
Chapter |9: |Risk |and |the |Cost |of |Capital
Chapter |10: |Project |Analysis
Chapter |11: |How |to |Ensure |That |Projects |Truly |Have |PositiveNPVs |
Chapter |12: |Efficient |Markets |and |Behavioral |Finance
Chapter |13: |An |Overview |of |Corporate |Financing
Chapter |14: |How |Corporations |Issue |Securities |
Chapter |15: |Payout |Policy
Chapter |16: |Does |Debt |Policy |Matter?
Chapter |17: |How |Much |Should |a |Corporation |Borrow?
Chapter |18: |Financing |and |Valuation |
Chapter |19: |Agency |Problems |and |Corporate |Governance
Chapter |20: |Stakeholder |Capitalism |and |Responsible |Business |
Chapter |21: |Understanding |Options
Chapter |22: |Valuing |Options
Chapter |23: |Real |Options |
Chapter |24: |Credit |Risk |and |the |Value |of |Corporate |Debt
Chapter |25: |The |Many |Different |Kinds |of |Debt
Chapter |26: |Leasing
Chapter |27: |Managing |Risk
Chapter |28: |International |Financial |Management |
Chapter |29: |Financial |Analysis
Chapter |30: |Financial |Planning
Chapter |31: |Working |Capital |Management
Chapter |32: |Mergers
Chapter |33: |Corporate |Restructuring |
,Chapter |34: |Conclusion: |What |We |Do |and |Do |Not |Know |about |Finance
CHAPTER |1
Introduction |to |Corporate |Finance
The |values |shown |in |the |solutions |may |be |rounded |for |display |purposes. |However, |the |answers |were
|derived |using |a |spreadsheet |without |any |intermediate |rounding.
Answers |to |Problem |Sets
1. a. real
b. executive |airplanes
c. brand |names
d. financial
e. bonds
*f. investment |or |capital |expenditure
*g. capital |budgeting |or |investment
h. financing
*Note |that |f |and |g |are |interchangeable |in |the |question.
Est |time: |01-05
2. A |trademark, |a |factory, |undeveloped |land, |and |your |work |force |(c, |d, |e, |and |g) |are |all |real |assets.
|Real |assets |are |identifiable |as |items |with |intrinsic |value. |The |others |in |the |list |are |financial
|assets,|that |is, |these |assets |derive |value |because | of |a |contractual |claim.
Est |time: |01-05
3. a. Financial |assets, |such |as |stocks |or |bank |loans, |are |claims |held |by |investors.
|Corporations |sell |financial |assets |to |raise |the |cash |to |invest |in |real |assets |such |as
|plant|and |equipment. | Some |real |assets |are |intangible.
b. Capital |expenditure |means |investment |in |real |assets. |Financing |means |raising |the | cash
|for |this |investment.
, c. The |shares |of |public |corporations |are |traded |on |stock |exchanges |and |can |be |purchased
|by |a |wide |range |of |investors. |The |shares |of |closely |held |corporations |are |not | publicly
|traded |and |are | held |by |a |small |group |of |private |investors.
d. Unlimited |liability: |Investors |are |responsible |for |all |the |firm‘s |debts. |A |sole |proprietor |has
|unlimited |liability. |Investors |in |corporations |have |limited |liability. |They |can |lose |their
|investment, |but |no |more.
Est |time: |01-05
