Read the specified transaction assumptions
The teaching cases deliberately isolate one movement at a time. No unspecified costs, financing or valuation gains are inserted. A missing source field remains unknown until supplied.
Keep the economic question explicit
A ratio change, a currency gain and a liquidity shortfall are different outputs. Explain how the given event changes the base, value components or cash path rather than treating every balance change as performance.
Try the questions
A 20 contribution stays as cash. Paid-in 100→120 and residual 110→130; distributions stay 40. What happens to value above paid-in?
- A.
It increases by 20
- B.
It remains 50
- C.
It decreases to zero
Answer and explanation
Answer: B
170−120 equals the original 150−100.
- A
New owner capital is not a new gain under this case.
- B
Both total value and paid-in increase by the same 20.
- C
The original value surplus is not removed by the contribution.
Paid-in 100 and distributions 40 are known, but residual is unavailable. What exact ratio can be reported?
- A.
TVPI 0.4×
- B.
DPI 0.4×
- C.
RVPI 1×
Answer and explanation
Answer: B
Unknown residual prevents exact TVPI and RVPI; DPI remains computable.
- A
This silently assumes residual zero.
- B
It uses only supplied compatible inputs.
- C
No residual figure supports that statement.
Cash starts at 30. A 40 call occurs before a 20 distribution, with no other cash source. What is the maximum unfinanced shortfall?
- A.
0
- B.
10
- C.
40
Answer and explanation
Answer: B
The path is 30→−10→10, so the peak shortfall is 10.
- A
The positive final cash hides the earlier shortfall.
- B
Cash falls to −10 before the receipt.
- C
The initial 30 funds part of the call.