Download topics covered in the executive programs admissions test

TOPICS COVERED IN
THE EXECUTIVE PROGRAMS ADMISSIONS TEST
1. ACCOUNTING
Fundamentals
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Recognize a balance sheet
Recognize an income statement
Recognize a cash flow statement
Recognize three required statements
Know which of the required statements describe time periods instead of points in time
Identify the assets portion of a balance sheet
Identify the liabilties portion of a balance sheet
Identify the equity portion of a balance sheet
Define asset
Define liability
Define equity in the context of a balance sheet
Apply the assets = liabilities + equity relation
Define paid-in capital in the context of a balance sheet
Define retained earnings in the context of a balance sheet
Understand that equity has a residual claim on assets
Distinguish which facts would be presented in financial statements
Distinguish between current and noncurrent assets
Distinguish between current and noncurrent liabilities
Explain the difference between equity and cash position
Define accounts receivable
Define inventory
Identify the components of equity that can be negative
Recognize common synonyms for net income
Define fiscal year
Recognize the three sections of a Cash Flow Statement
Liabilities and Equity
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Calculate market capitalization
Understand effect of price per share on the balance sheet
Identify the financial statements that are affected by issuing dividends
Given a balance sheet, calculate working capital
Given a balance sheet, calculate debt capital
Demonstrate an understanding of the components of paid-in capital for a corporation
Distinguish between value of equity account and market capitalization
Describe highly leveraged in terms of debt as a fraction of equity capital
Distinguish between debt capital and equity capital
2. FINANCE
Risk and Return:
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Calculate rate of return (1 period)
Define average rate of return
Describe how risk determines required return
Distinguish between expected and realized return
Define opportunity cost of capital
Describe arbitrage
Define market efficiency
Define Law of One Price
Define liquidity
Define financial intermediation
Define a bond
Zero coupon vs. level coupon bonds
Calculate the value of a bond
Explain the risk-free rate
Explain the effect of market interest rates on the value of a bond
Distinguish between government and corporate bonds
Define stock
Dividends vs. capital appreciation
Common vs. preferred shares
Public vs. private corporations
Define mutual funds
Explain the diversification effect
Systematic vs. diversifiable risk
Compare long-term risk for stocks vs. bonds
Relationship between risk and return for a stock
Time Value:
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Calculate compounded interest
Determine required principal from interest and future value
Convert future value to present value
Compare daily and yearly compounding
Calculate the net present value of a cash flow
Calculate the internal rate of return of a cash flow
Evaluate a project based on net present value or internal rate of return
Define perpetuity
Calculate the present value of a perpetuity
Calculate the present value of a growing perpetuity
Calculate the rate of return of a perpetuity
Define annuity
Calculate the present value of an annuity
3. STATISTICS
Probability
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Calculate the probability of an event
Use the relation Pr(not A) = 1 - Pr(A)
Recognize when events are mutually exclusive
Apply Pr(A or B) = Pr(A) + Pr(B) for mutually exclusive events
Apply Pr(A or B) = Pr(A) + Pr(B) - Pr(A & B)
Recognize when events are independent
Apply Pr(A and B) = Pr(A)Pr(B) for independent events
Interpret the Pr(A|B) notation
Apply Pr(A|B) = Pr(A) for independent events
Calculate Pr(A|B) if A and B are not independent
Descriptive
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Calculate the mean (discrete trials)
Calculate the median (discrete trials)
Calculate the mode (discrete trials)
Calculate the variance (discrete trials)
Calculate the standard deviation (discrete trials sample)
Calculate the standard deviation (population)
Calculate a weighted average
Define the term 'expected value'
Read a histogram with absolute frequencies
Read a histogram with relative frequencies
Estimate a percentile statistic from a histogram
Distinguish between a sample and a population
Explain what sample bias is
Distributions
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Distinguish a discrete and a continuous distribution
Distinguish a p.m.f. and a p.d.f.
Calculate the probability from a p.m.f.
Calculate probability from a p.d.f.
Recognize the effect on a distribution plot of changing the mean
Recognize the effect on a distribution plot of changing the std. deviation
Distinguish median and mean on a distribution plot
Identify a plot of a Normal distribution
Calculate probability that a normal random variable is in certain range
Define z-value
Recognize probabilities corresponding to z-values 1, 2, 3
Recognize z-values corresponding to probabilities 90%, 95%, 99%