TCU Finance Exit Exam LATEST
2026/2027 ACTUAL EXAM QUESTIONS
WITH CORRECT ANSWERS 100%
VERIFIED GRADED A+
Calculatemthempresentmvaluemormfuturemvaluemofmamlumpm(single)msum.m-
mCORRECTmANSWERmomPVm=mFVm/m(1+i)^n
omFVm=mPV(1+i)^n
FindmnumbermofmperiodsmorminterestmratemformlumpmsummcashmflowmifmgivenmPVmandmFVm-
mCORRECTmANSWERmCalculatormtime(seemabovemrelationships)
CalculatemPVmormFVmofmanmannuitymandmofmanmannuitymduem-
mCORRECTmANSWERmRemembermtomsetmTVM:mPMT:end/beginning
IfmsolvingmformFV,msetmPVmtom0
IfmsolvingmformPV,msetmFVmtom0
PMT=annualmpayment
FV=0mormsolvemfor
i=marketmrate
PV=0mormsolvemfor
FindmPMT,minterestmrate,mormnumbermofmpaymentsminmannuitymormannuitymduemproblemmwithmann
ualmormnon-annualmpaymentsm-mCORRECTmANSWERmRemembermtomadjustmformnon-
annualmpayments
FindmthemPV,mPMT,morminterestmratemformamperpetuitym-
mCORRECTmANSWERmPerpetuity:mPV=PMT/interestmrate
,Calculatemthemeffectivemannualmratemformanminterestmratemcompoundedmmoremthanmonemtimemper
myearm-mCORRECTmANSWERmom((1+mi/n)^n)m-m1
omIm=mstatedmannualminterestmrate
omNm=mnumbermofmperiods
Preparemamloanmamortizationmtablem-
mCORRECTmANSWERmMonthlympayment:mCalculator:msolvemformPMTmusingmPV=principalmandmFV=
0
Paymattentionmtomannuitymormannuitymdue
Formeachmpayment,mmultiplyminterestmratemtimesmremainingmprinciplemtomdetermineminterestmport
ionmofmpayment.mThemremainingmamountmgoesmtowardsmprinciple.
Understandmthemeffectmofmtimemandminterestmratemonmpresentmandmfuturemvaluesmofmamcashmflowm-
mCORRECTmANSWERm•mThemfurthermoutminmtime,mthemlessmthemPVmbecomes
•mThemhighermthemdiscountmrate,mthemlowermthemPVmbecomes
Calculatemthempricemofmambondm-mCORRECTmANSWERmomPVmofminterestmpayments
-Findmannualmcouponmrate,mormsemiannualm
-Findmsemiannualmdiscountmrate,mormthembondsmwithmsimilarmmaturities
-Multiplemtimemtommaturitymbym2
omPVmofmprincipalmamount
Calculatemthemyieldmtommaturitymofmambondm-
mCORRECTmANSWERmomThemyieldmtommaturitymismthemdiscountmratemthatmequatesmthembond'smcurr
entmpricemwithmitsmstreammofmpromisedmfuturemcashmflows.
omOnmcalculator,msolvemformI/Y,mandmthenmmultiplymbymtwomifmsemiannualmtomgetmannualmyield
, Understandmthemimpactmofmtimemtommaturitymonmchangesminmbondmpricesmasmyieldmchangesm(chec
k)m-
mCORRECTmANSWERmomAmlongermtermmbondmneedsmtomhavemamhigherminterestmratemtombemvaluabl
emduemtommoremrisk;malso,masmambondmapproachesmmaturity,mitsmpricemwillmconvergemwithmitsmfacem
value
omWhenminterestmratesmrise,mthempricemofmoutstandingmbondsmfall.mWhenminterestmratesmfall,mthem
pricemofmoutstandingmbondsmrise
*Amchangeminmyieldmproducesmambiggermchangeminmam10bondmvsmam5myearmnote
Explainmbondmdurationm-
mCORRECTmANSWERmomThemweightedmaveragemperiodmofmtimembeforemthempricemofmambondmismrep
aidmbymitsmcashmflows.mZero-couponmbondmduration=itsmtimemtommaturity.
omImportancemismthatmitmpredictsmhowmsharplymthemmarketmpricemofmambondmwillmchangemasmamres
ultmofmchangesminminterestmrates(ormothermfactorsmofmvolatility)
Calculatemthempricemofmpreferredmstockm-
mCORRECTmANSWERmThempricemofmpreferredmstockm=mpreferredmdividendm/mrequiredmreturnmonmth
emstock
Calculatemthemexpectedmreturnmofmpreferredmstockm(checkmthis)m-
mCORRECTmANSWERmexpectedmreturnm=mpreferredmdividend/pricemofmthempreferredmstock
Calculatemthemvaluemofmcommonmstockmusingmthemdividendmdiscountmmodel,mearningsmmodel,man
dmfirm'smfreemcashmflows.m(check)m-
mCORRECTmANSWERmDividendmdiscountmmodel:mValuemofmstockm=mDividendmpermsharem/m(Discoun
tmratem-mDividendmgrowthmrate)
Earningsmmodel:
Freemcashmflows:
2026/2027 ACTUAL EXAM QUESTIONS
WITH CORRECT ANSWERS 100%
VERIFIED GRADED A+
Calculatemthempresentmvaluemormfuturemvaluemofmamlumpm(single)msum.m-
mCORRECTmANSWERmomPVm=mFVm/m(1+i)^n
omFVm=mPV(1+i)^n
FindmnumbermofmperiodsmorminterestmratemformlumpmsummcashmflowmifmgivenmPVmandmFVm-
mCORRECTmANSWERmCalculatormtime(seemabovemrelationships)
CalculatemPVmormFVmofmanmannuitymandmofmanmannuitymduem-
mCORRECTmANSWERmRemembermtomsetmTVM:mPMT:end/beginning
IfmsolvingmformFV,msetmPVmtom0
IfmsolvingmformPV,msetmFVmtom0
PMT=annualmpayment
FV=0mormsolvemfor
i=marketmrate
PV=0mormsolvemfor
FindmPMT,minterestmrate,mormnumbermofmpaymentsminmannuitymormannuitymduemproblemmwithmann
ualmormnon-annualmpaymentsm-mCORRECTmANSWERmRemembermtomadjustmformnon-
annualmpayments
FindmthemPV,mPMT,morminterestmratemformamperpetuitym-
mCORRECTmANSWERmPerpetuity:mPV=PMT/interestmrate
,Calculatemthemeffectivemannualmratemformanminterestmratemcompoundedmmoremthanmonemtimemper
myearm-mCORRECTmANSWERmom((1+mi/n)^n)m-m1
omIm=mstatedmannualminterestmrate
omNm=mnumbermofmperiods
Preparemamloanmamortizationmtablem-
mCORRECTmANSWERmMonthlympayment:mCalculator:msolvemformPMTmusingmPV=principalmandmFV=
0
Paymattentionmtomannuitymormannuitymdue
Formeachmpayment,mmultiplyminterestmratemtimesmremainingmprinciplemtomdetermineminterestmport
ionmofmpayment.mThemremainingmamountmgoesmtowardsmprinciple.
Understandmthemeffectmofmtimemandminterestmratemonmpresentmandmfuturemvaluesmofmamcashmflowm-
mCORRECTmANSWERm•mThemfurthermoutminmtime,mthemlessmthemPVmbecomes
•mThemhighermthemdiscountmrate,mthemlowermthemPVmbecomes
Calculatemthempricemofmambondm-mCORRECTmANSWERmomPVmofminterestmpayments
-Findmannualmcouponmrate,mormsemiannualm
-Findmsemiannualmdiscountmrate,mormthembondsmwithmsimilarmmaturities
-Multiplemtimemtommaturitymbym2
omPVmofmprincipalmamount
Calculatemthemyieldmtommaturitymofmambondm-
mCORRECTmANSWERmomThemyieldmtommaturitymismthemdiscountmratemthatmequatesmthembond'smcurr
entmpricemwithmitsmstreammofmpromisedmfuturemcashmflows.
omOnmcalculator,msolvemformI/Y,mandmthenmmultiplymbymtwomifmsemiannualmtomgetmannualmyield
, Understandmthemimpactmofmtimemtommaturitymonmchangesminmbondmpricesmasmyieldmchangesm(chec
k)m-
mCORRECTmANSWERmomAmlongermtermmbondmneedsmtomhavemamhigherminterestmratemtombemvaluabl
emduemtommoremrisk;malso,masmambondmapproachesmmaturity,mitsmpricemwillmconvergemwithmitsmfacem
value
omWhenminterestmratesmrise,mthempricemofmoutstandingmbondsmfall.mWhenminterestmratesmfall,mthem
pricemofmoutstandingmbondsmrise
*Amchangeminmyieldmproducesmambiggermchangeminmam10bondmvsmam5myearmnote
Explainmbondmdurationm-
mCORRECTmANSWERmomThemweightedmaveragemperiodmofmtimembeforemthempricemofmambondmismrep
aidmbymitsmcashmflows.mZero-couponmbondmduration=itsmtimemtommaturity.
omImportancemismthatmitmpredictsmhowmsharplymthemmarketmpricemofmambondmwillmchangemasmamres
ultmofmchangesminminterestmrates(ormothermfactorsmofmvolatility)
Calculatemthempricemofmpreferredmstockm-
mCORRECTmANSWERmThempricemofmpreferredmstockm=mpreferredmdividendm/mrequiredmreturnmonmth
emstock
Calculatemthemexpectedmreturnmofmpreferredmstockm(checkmthis)m-
mCORRECTmANSWERmexpectedmreturnm=mpreferredmdividend/pricemofmthempreferredmstock
Calculatemthemvaluemofmcommonmstockmusingmthemdividendmdiscountmmodel,mearningsmmodel,man
dmfirm'smfreemcashmflows.m(check)m-
mCORRECTmANSWERmDividendmdiscountmmodel:mValuemofmstockm=mDividendmpermsharem/m(Discoun
tmratem-mDividendmgrowthmrate)
Earningsmmodel:
Freemcashmflows:
