Financial literacy

You have observed the following returns over time: Year Stock X Stock Y Market 2

You have observed the following returns over time: Year Stock X Stock Y Market 2009 14% 13% 12% 2010 19 7 …

You have observed two stocks, Stock X and Stock Y, as well as the overall stock

You have observed two stocks, Stock X and Stock Y, as well as the overall stock market, over a number of years and have calculated the following information from the raw observati…

You have obtained the following information about five companies and a target yo

You have obtained the following information about five companies and a target you wish to value, Bakal Distributing. Additional information: • Bakal had earnings of $751 million i…

You have obtained the following schedule of long-term debt from McNeil Company f

You have obtained the following schedule of long-term debt from McNeil Company for the audit of financial statements for the year ended December 31, year 3. Notes Interest Due Dat…

You have purchased 1 million shares in a restaurant chain venture. At this zero-

You have purchased 1 million shares in a restaurant chain venture. At this zero-stage investment, your company’s assets are $110,000 plus the idea for your new product. Look back …

You have purchased a call option contract on GE common stock. The option has an

You have purchased a call option contract on GE common stock. The option has an exercise price of $79.00 and GE stock currently trades at $80.43. The option premium is quoted at $…

You have purchased a call option contract on Smith & Smith common stock. The opt

You have purchased a call option contract on Smith & Smith common stock. The option contract is for 100 shares. The option has an exercise price of $23.00 and S & S’s stoc…

You have purchased a call option contract on Smith & Smithcommon stock. The opti

You have purchased a call option contract on Smith & Smithcommon stock. The option contract is for 100 shares. The option has an exercise price of $ 43.00 and S&S’s stock …

You have purchased a deffered annuity. In this case you pay $10,000 today and th

You have purchased a deffered annuity. In this case you pay $10,000 today and the insurnace company will begin to pay you yearly payments in 15 years. Your $10,000 grows at 6% pe…

You have purchased a home for $200,000 with a down payment of 10 percent. Prevai

You have purchased a home for $200,000 with a down payment of 10 percent. Prevailing mortgage interest rates are 4.5 percent. If you finance the home for 30 years, what is your mo…

You have purchased a machine costing $34,000. The machine will be used for two y

You have purchased a machine costing $34,000. The machine will be used for two years, and at the end of this time, its salvage value is expected to be $12,000. The machine will be…

You have purchased a put option on Kimberly Clark common stock. The option has a

You have purchased a put option on Kimberly Clark common stock. The option has an exercise price of $79 and Kimberly Clark?s stock currently trades at $80.18. The option premium i…

You have purchased a put option on Kimberly Clark common stock. The option has a

You have purchased a put option on Kimberly Clark common stock. The option has an exercise price of $81 and Kimberly Clark’s stock currently trades at $82.18. The option premium i…

You have purchased a put option on Kimberly Clark common stock. The option has a

You have purchased a put option on Kimberly Clark common stock. The option has an exercise price of $72 and Kimberly Clark’s stock currently trades at $73.18. The option premium i…

You have purchased a put option on Pfizer common stock. The option has an exerci

You have purchased a put option on Pfizer common stock. The option has an exercise price of $53 and Pfizer?s stock currently trades at $55. The option premium is $0.80 per contrac…

You have received a purchase requisition for 5,000 roller bearings. The purchase

You have received a purchase requisition for 5,000 roller bearings. The purchase requisition estimate is $8.00 per unit for a total of $40,000. This estimate is based on a recent …

You have recently accepted a one-year employment term by a firm. The firm has gi

You have recently accepted a one-year employment term by a firm. The firm has given you the option of receiving your salary as a lump sum value of $30,000 at the end of the year o…

You have recently been employed by a firm for a period of one year. The firm has

You have recently been employed by a firm for a period of one year. The firm has given you the option of receiving your salary as a lump sum value of $30,000 at the end of the yea…

You have recently been hired by ABC corporation and your first assignment is to

You have recently been hired by ABC corporation and your first assignment is to help them decide which of these two options should be pursued. You would like to apply the capital …

You have recently been hired by Swan Motors, Inc. (SMI), in its relatively new t

You have recently been hired by Swan Motors, Inc. (SMI), in its relatively new treasury management department. SMI was founded 8 years ago by Joe Swan. Joe found a method to manuf…

You have recently been hired by Swan Motors, Inc. (SMI), in its relatively new t

You have recently been hired by Swan Motors, Inc. (SMI), in its relatively new treasury management department. SMI was founded 8 years ago by Joe Swan. Joe found a method to manuf…

You have recently bought some graphic design software that is a far superior pro

You have recently bought some graphic design software that is a far superior product, you believe, to its competitors on the market. The price is rather high, but the purchase was…

You have recently decided to purchase a local building supply store. The busines

You have recently decided to purchase a local building supply store. The business has passed the initial screening test and you are ready to begin discussing prices with the prese…

You have recently discovered a new strain of grain that is higher in protein tha

You have recently discovered a new strain of grain that is higher in protein than quinoa (a grain that is very high in protein). Although you like the taste of this grain, it has …

You have recently graduated with a major in finance and landed a financial plann

You have recently graduated with a major in finance and landed a financial planner job with Barney Smith Inc., a large financial services corporation. Your first assignment is to …

You have recently graduated with a major in finance and landed a financial plann

You have recently graduated with a major in finance and landed a financial planner job with Barney Smith Inc., a large financial services corporation. Your first assignment is to …

You have recently graduated with a major in finance and landed a financial plann

You have recently graduated with a major in finance and landed a financial planner job with Barney Smith Inc., a large financial services corporation. Your first assignment is to …

You have recently joined a company, Felicia & Fred, as a financial analyst. The

You have recently joined a company, Felicia & Fred, as a financial analyst. The company is headquartered in New England and manufactures unique fashion jewelry. It prides itse…

You have recently purchased stock in Topical Inc. which has returned between 6%

You have recently purchased stock in Topical Inc. which has returned between 6% and 9% over the last three years. Your friend, Bob, has criticized your purchase and insists that y…

You have recently taken over a new organization. You are new to the organization

You have recently taken over a new organization. You are new to the organization, but not to leadership. In fact, in your last position as Director of Operations, you led the orga…

You have recently won the super jackpot in the Illinois state lottery- On readin

You have recently won the super jackpot in the Illinois state lottery- On reading the line print, you discover that you have the following two options: You receive $160,000 at the…

You have recently won the super jackpot in the Washington State Lottery. On read

You have recently won the super jackpot in the Washington State Lottery. On reading the fine print, you discover that you have the following two options: You will receive 32 an…

You have regressed the excess returns for two stocks on the corresponding excess

You have regressed the excess returns for two stocks on the corresponding excess returns for the market with the following results: RA = 0.01 + 1.2(RM); R2 = 0.576; residual stand…

You have reviewed your budget and determined that you can afford to pay $300 per

You have reviewed your budget and determined that you can afford to pay $300 per month as a car payment. How much can you borrow if your credit is good and the interest rate is 4 …

You have started a hedge fund that will follow Bernie Madoffs split-strike strat

You have started a hedge fund that will follow Bernie Madoffs split-strike strategy. Your strategy is (i) take a long position of 1000 shares in SPY (the S&P 500), (ii) sell 2…

You have started a hedge fund that will follow Bernie Madoffs split-strike strat

You have started a hedge fund that will follow Bernie Madoffs split-strike strategy. Your strategy is (i) take a long position of 1000 shares in SPY (the S&P 500), (ii) sell 2…

You have started an international business and buy some of your products from ch

You have started an international business and buy some of your products from china. The Chinese company requests to be paid in Yuan (CNY). You recently placed an order costing 10…

You have successfully started and operated a company for the past 10 years. You

You have successfully started and operated a company for the past 10 years. You have decided that it is time to sell your company and spend time on the beaches of Hawaii. A potent…

You have successfully started and operated a company for the past 10 years. You

You have successfully started and operated a company for the past 10 years. You have decided that it is time to sell your company and spend time on the beaches of Hawaii. A potent…

You have successfully started and operated a company for the past 10 years. You

You have successfully started and operated a company for the past 10 years. You have decided that it is time to sell your company and spend time on the beaches of Hawaii. A potent…

You have successfully started and operated a company for the past 10 years. You

You have successfully started and operated a company for the past 10 years. You have decided that it is time to sell your company and spend time on the beaches of Hawaii. A potent…

You have taken a job as an entry-level analyst, and your boss has asked you to f

You have taken a job as an entry-level analyst, and your boss has asked you to find the expected value of Pandar Corp's stock. As you were doing your research, you found out that …

You have taken a job as an entry-level analyst, and your boss has asked you to f

You have taken a job as an entry-level analyst, and your boss has asked you to find the expected value of Dual Purposes Products Co.'s stock. As you were doing your research, you …

You have taken a job with Afford Motor Company. The CEO, Kit Carson, has propose

You have taken a job with Afford Motor Company. The CEO, Kit Carson, has proposed that Afford Motors develop, manufacture, and sell an electric car that she claims will present a …