Modern Artifacts can produce keepsakes that will be sold for $270 each. Nondepreciation fixed costs are $3,200 per year, and variable costs are $190 per unit. The initial investment of $9,600 will be depreciated straight-line over its useful life of 8 years to a final value of ze...
04 Sep 2020Rambo Enterprises, Inc. stock has a beta of 1.12. The risk-free rate of return is 2.46 percent and the market risk premium is 5.26 percent. What is the expected rate of return on this stock?8.35 percent9.01 percent10.23 percent13.21 percent13.73 percent
04 Sep 2020AIA Inc. is looking to manage its cash position using the EOQ model. The company is consuming cash at the rate of $6600 per day, and is open for business 365 days in the year. Each time the firm sells securities to obtain the cash, it costs them $200. The interest rate is 2.80%. ...
04 Sep 2020List two reasons why valuation is critical to an Investment Bankâs functions.
04 Sep 2020Study the case Geothermal Kinetics v. Union Oil Co. of California and answer the following questions:1. Research online for the definition of âmineral.â Define it in your own words.2. The petitioner/appellant (the party who lost at the trial court level) contends that geother...
04 Sep 2020A manufacturer finds that it has another $30,000 it can add to its budget in the production of a new product. By how much would this increase profit, if the solution indicates a dual price of 12.25 for the budget constraint and it is within limits?
04 Sep 2020The risk-free rate of return is currently 0.03, whereas the market premium is 0.04. If the beta of RKP Inc., stock is 1.4, then what is the expected return on RKP?
04 Sep 2020Compute the forward premium or discount for the British pound whose 180-day forward rate is $1.75 and the spot rate is $1.78. State whether your answer is a premium or discount.
04 Sep 2020Assess credit risk and re-pricing interest rates risk.
04 Sep 2020One year ago, Debra purchased 4,200 shares of KNF stock for $177,072. Today, she sold those shares for $48.10 a share. What is the capital gains yield on this investment if the dividend yield is 4.1 percent?
04 Sep 2020the risk-free rate on Treasury bonds is 6.8%. If the market-risk premium is 8.8% and Perfect Processings beta is 1.4, what is the cost of equity?
04 Sep 2020London purchased a piece of real estate last year for $82,900. The real estate is now worth $105,000. If London needs to have a total return of 0.24 during the year, then what is the dollar amount of income that she needed to have to reach her objective?
04 Sep 2020Suppose ABC Mutual Fund had no liabilities and owned only four stocks as follows: Stock Shares Price Market Value W X Y Z 1,000 1,200 1,500 800 $12 15 22 16 $12,000 18,000 33,000 12,800 $75,800 The fund began by selling $50,000 of stock at $8.00 per share. What is its NAV?
03 Sep 2020John is a 24 year old retail employee. John loses his job. He actively seeks work for many months as his savings dwindle and his unemployment insurance benefits are exhausted. In order to avoid eviction, John borrows $1,000 from the local CashFast granting CashFast a security int...
03 Sep 2020In 1895, the first Putting Green Championship was held. The winnerâs prize money was $140. In 2014, the winnerâs check was $1,420,000. What was the percentage increase per year in the winnerâs check over this period?
03 Sep 2020XYZ Corporation has a $1,000 (FV) par value, 10-year bond that pays 9% coupon interest per year paid semi-annually. If the current yield to maturity (I/Y) of similar risk bonds is 13.5%, what is the price of the bond PV)? ($756.93 is the answer; how do you figure it?)
03 Sep 2020the exchange rate between US dollar and euro is: Euro1=$1.35 and the exchange rate between British pound and US dollar is 1Pound = $1.40. What is the cross rate between Euro and British poundAsked on 31 Dec 2019OC2736346Answered on 31 Dec 2019Cross rate between euro and british p...
03 Sep 2020r6 = r* IP MRPr6 = 2.8 ((356333)/6) 0.12r6 = 2.8%3.67%0.12%= 6.59%in this r6 = return of 6 years treasury bondr= risk free rateip average inflationmrp= market risk premium
03 Sep 2020The beta of M Simon Inc., stock is 1.8, whereas the risk-free rate of return is 0.07. If the expected return on the market is 0.15, then what is the expected return on M Simon Inc?
03 Sep 2020Discuss how users should have limited menus based on the access they have to the data.
03 Sep 2020A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:Units in beginning inventory 0Units produced 7,000Units sold 6,900Units in ending inventory 100Variable costs per unitDirect materials $46Direct l...
03 Sep 2020The beta of stock a is .7, the beta of stock b is .7, and the beta of stock c is 2. What is the beta of an equally weighted portfolio consisting of stocks a, b, and c?
03 Sep 2020Consider a project to supply Detroit with 40,000 tons of machine screws annually for automobile production. You will need an initial $5,200,000 investment in threading equipment to get the project started; the project will last for six years. The accounting department estimates t...
03 Sep 2020We Do Bankruptcies is a law firm that specializes in providing advice to firms in financial distress. It prospers in recessions when other firms are struggling. Consequently, its beta is negative, â.2.a. If the interest rate on Treasury bills is 5% and the expected return on th...
03 Sep 2020A share of stock with a beta of .69 now sells for $44. Investors expect the stock to pay a year-end dividend of $4. The T-bill rate is 6%, and the market risk premium is 9%. If the stock is perceived to be fairly priced today, what must be investorsâ expectation of the price of...
03 Sep 2020Matthew owns 30 percent of the outstanding stock of Lindman and has the ability to significantly influence the investeeâs operations and decision making. On January 1, 2015, the balance in the Investment in Lindman account is $427,000. Amortization associated with this acquisit...
03 Sep 2020Lee purchased a stock one year ago for $28. The stock is now worth $31, and the total return to Lee for owning the stock was 0.36. What is the dollar amount of dividends that he received for owning the stock during the year?
03 Sep 2020You are considering acquiring a firm that you believe can generate expected cash flows of $12,000 a year forever. However, you recognize that those cash flows are uncertain. a. Suppose you believe that the beta of the firm is .6.a. How much is the firm worth if the risk-free rate...
03 Sep 2020Initially, Eleanor earns a salary of $200 per year and Darnell earns a salary of $100 per year. Eleanor lends Darnell $50 for one year at an annual interest rate of 16% with the expectation that the rate of inflation will be 5% during the one-year life of the loan. At the end of ...
03 Sep 20201. A portfolio has an expected return of 10% and a standard deviation of 20%. Assume normal distribution, what is Value at Risk (VaR) at 5% for this stock?A. -40.21%B. -32.25%C. -22.90%D. -28.32%2. An investor buys $10,000 worth of a stock priced at $50 per share using 50% initia...
03 Sep 2020Investors expect the market rate of return this year to be 11%. A stock with a beta of .9 has an expected rate of return of 9%. If the market return this year turns out to be 7%, what is the rate of return on the stock?
03 Sep 2020Calculate the projectâs NPV, IRR, MIRR and Payback period. Should the project be accepted?The background to these question is: .After several months, they felt Central should go ahead with the project. They would set up production in an unused section of their main plant. New m...
03 Sep 2020you lend $17,000 for which your friend will repay you $31,000 at the end of 8 years. What is the interest rate you are charging your friend?
03 Sep 2020carter inc is evaluating security. calculate the investments expected return and its standard deviation.0.05 - 6%.30 - 7%.60- 10%0.05 - 14%A. the investment expected rate of return is%? B. The investments standard deviation is%?
03 Sep 2020Which of the following regulatory events in the 20th Century potentially influenced the financial sector.Passing of the Glass-Steagall ActEstablishment of the Securities and Exchange Commission (SEC)Establishment of the Federal Reserve Banking SystemRepeal of the Glass-Steagall A...
03 Sep 20201. (TCOs 6 and 7) The Capitalist Mutual Funds portfolio is valued at $48 million. The fund has liabilities of $4 million, and the investment company sponsoring the fund has issued 1,600,000 shares. What is the funds net asset value? (Points : 1) $48.00 $30.00 $36.66 $27.50 $...
03 Sep 2020Consider an investment that pays off $300 or $1,100 per $1,000 invested with equal probability. Suppose you have $1,000 but are willing to borrow to increase your expected return. What would happen to the expected value and standard deviation of the investment if you borrowed an ...
03 Sep 2020Assume you can save $8,500 at the end of Year 2, $9,300 at the end of Year 3, and $7,100 at the end of Year 6. If today is Year 0, what is the future value of your savings 10 years from now if the rate of return is 7.8 percent annually?
03 Sep 2020Explore leverage as it related to the financial crisis of 2008/2009 and share what you learned. Comment
03 Sep 2020assume a significant decline credit balances at brokerage firms. Discuss why a technician would consider this bullish or bearish? Explain why?
03 Sep 2020Consider an investment that pays off $800 or $1,400 per $1,000 invested with equal probability. What is the maximum leverage ratio you could have and still have enough to repay the loan in the event the bad outcome occurred? Instructions: Enter your answers as whole numbers. The ...
03 Sep 2020DirectionsI. For each of the following sets of premises, use simplification, conjunction,modus ponens, and/or modus tollens to construct a proof for the indicated conclusion. Be sure to cite the rules you use out to the side. (2 pts. each)Example:1. ((A v B) -- > C)2. ((A v B) & ...
03 Sep 2020You are evaluating various investment opportunities currently available and you have calculated expected returns and standard deviations for five different well-diversified portfolios of risky assets: A) For each portfolio, calculate the risk premium per unit of risk that you exp...
03 Sep 2020__________ entails obtaining a loan from a lender.A.Selling interest in the organizationB.Borrowing from lendersC.Borrowing from investorsD Retaining excess revenues over expensesAsked on 31 Dec 2019
03 Sep 2020Which of the following is a benefit for health care organizations that make good financial decisions when obtaining debts?A.Increased debtB.StabilityC.Decreased assetsD.Zero liabilities
03 Sep 2020Which of the following is true of the impact of cash flows on net working capital?A.the lower the cash outflows lowers is the net working capitalB.The more predictable the cash inflows of a firm, the more current assets a firm needsC. Th emore predictable the cash inflows of a fi...
03 Sep 2020__________ is dependent upon the organizationâs legal structure.A. Selling interest in the organizationB.Borrowing from lendersC.Borrowing from investorsD. Retaining excess revenues over expenses
03 Sep 2020An investor buys $10,000 worth of a stock priced at $50 per share using 50% initial margin. The broker charges 10% on the margin loan and requires a 30% maintenance margin. In one year the investor gets a margin call. At the time of the margin call the stocks price must have been...
03 Sep 2020Chamberlain Co. wants to issue new 15-year bonds for some much-needed expansion projects. The company currently has 6 percent coupon bonds on the market that sell for $1,030, make semiannual payments, and mature in 15 years.
03 Sep 2020You invest 60% in security A with a beta of 1.5 and 40% in security B with a beta of .90. The beta of this portfolio is _________.A. 1.26B. 1.20C. 1.50D. 1.14
03 Sep 2020
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