3. What is a venture capitalist? What is an IPO? What does the term underpricing an IPO mean? Why are IPOs typically underpriced? When might this be fraudulent? What is a leveraged buyout (LBO)?

4. Explain how a company can be reporting accounting profits but financial analysts could conclude that management is not adding economic valuein fact is reducing the value of the company. What would that imply about the firms IRR and ROE?

5. If 10-year U.S. Treasury notes yield 5% and German 10-year bunds yield only 1%, you as the CFO of a U. S. company propose to borrow lots of euros at 2.50%, sell the euros for dollars, earn 5% for six months and hedge your currency risk with a forward contract. That, you argue, will substantially increase profits. Should your boss approve this proposal? Why or why not?