Investment Banking interview preparation
Every question below is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it. Answers are written the way you would actually say them out loud — answer first, then the mechanism, then the limitation.
100 questions, mapped to the firms that asked them
- Questions
- 100
- Traced to a firm
- 100
- Firms
- 46
- Updated
- September 2026
016What are the main drivers or sensitivities in a DCF?TD SecuritiesInvestment Banking · New York · 2026Moelis & CompanyInvestment Banking · New York · 2026
Say this
The discount rate and the terminal value assumption, by a wide margin. After those, the revenue growth and margin path in the forecast years, then CapEx and working capital intensity.
Then walk it
- WACC dominates because it compounds. A 100 basis point move in WACC can swing value 15 to 20 percent for a long-duration business.
- Terminal value is the other big one, since it is usually 60 to 80 percent of enterprise value. A 50 basis point change in perpetuity growth moves the answer materially.
- Inside the forecast, margin matters more than revenue for most mature businesses, because a margin point drops straight to cash.
- CapEx and working capital intensity matter most for capital-hungry or fast-growing companies, where growth consumes cash.
- The standard output is a two-way sensitivity table, WACC against exit multiple or against perpetuity growth. That grid is what actually goes in the deck, not a single point value.
Where candidates lose it
Listing revenue growth first. It feels intuitive but it is wrong for most businesses; discount rate and terminal value swamp it. Also, saying 'a DCF gives you the intrinsic value' as if it were one number, rather than a range you present as a football field.
Expect next
- Given a $10 change in revenue, COGS, or CapEx, which has the biggest impact?
- How do you pick the perpetuity growth rate?
- What would you do if the DCF value is miles above the trading price?
Reported by candidates at TD Securities (Investment Banking, New York, 2026); Moelis & Company (Investment Banking, New York, 2026). Source: Wall Street Oasis.
053A PE firm bought a company for $1,000 and sold it for $1,000. How did they make money?TD SecuritiesInvestment Banking · Toronto · 2026
Say this
Debt paydown. Enterprise value did not move, but the debt inside it shrank, so the equity slice grew. Buy at $1,000 with $700 of debt and $300 of equity; if cash flow repays $300 of debt, you sell at $1,000 and the equity is now $600.
Then walk it
- Entry: $1,000 enterprise value, $700 debt, $300 sponsor equity.
- Over the hold, the company's free cash flow after interest pays down $300 of debt. Nothing else changes.
- Exit: $1,000 enterprise value less $400 remaining debt equals $600 of equity.
- That is 2.0 times the money. Over five years it is roughly a 15 percent IRR.
- Other routes to the same outcome: a dividend recap that returned cash mid-hold, or selling a division and returning proceeds while the remaining business held its value. Both put money in the sponsor's pocket without any change in headline enterprise value.
Where candidates lose it
Freezing because the entry and exit prices match. The question is testing whether you understand that the sponsor owns the equity, not the enterprise. Use round numbers immediately and show the two balance sheets.
Expect next
- What IRR is that over five years?
- What if they had used no debt at all?
- How else could they have made money at a flat exit?
Reported by candidates at TD Securities (Investment Banking, Toronto, 2026). Source: Wall Street Oasis.
092I paint the surface of a 10x10x10 cube green. How many of the small cubes have green on them, and how many do not?TD SecuritiesGeneralist · New York · 2024
Say this
488 have green on them and 512 do not. Solve the easy half first: the unpainted cubes form an inner 8x8x8 block, which is 512. Subtract that from 1,000 to get 488 painted.
Then walk it
- Total small cubes: 10 cubed is 1,000.
- Any cube not touching the surface is one layer in from every face. That leaves an 8 by 8 by 8 core, because you remove one layer from each of the two opposite sides in all three dimensions.
- 8 cubed is 512 unpainted.
- So painted is 1,000 minus 512, which is 488. Computing the painted faces directly is possible but far more error-prone.
- If they push further: 8 corner cubes have three painted faces, 96 edge cubes have two, and 384 face cubes have one. That sums to 488, which confirms the answer.
Where candidates lose it
Trying to count the painted cubes face by face and double-counting the edges and corners. Always solve for the interior and subtract. Saying 'I will do the easy side first' out loud is itself the signal they want.
Expect next
- How many have exactly two painted faces?
- Generalise it for an n-cube.
- Now do it for a 10x10x10 where I only paint the top and bottom.
Reported by candidates at TD Securities (Generalist, New York, 2024). Source: Wall Street Oasis.
Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.