Financial literacy

4. Two options are available for setting up a wireless meter scanner and control

4. Two options are available for setting up a wireless meter scanner and controller. A simple setup is good for 2 years and has an initial cost of $14,000, no salvage value, and a…

4. Two years ago, Company A arranged a long-term loan of £15m at fixed interest

4. Two years ago, Company A arranged a long-term loan of £15m at fixed interest of 2 per cent per annum to finance the expansion of its business Interest rates have been falling o…

4. Unequal project lives Newtown Corp. has to choose between two mutually exclus

4. Unequal project lives Newtown Corp. has to choose between two mutually exclusive projects. If it chooses project A, Newtown Corp. will have the opportunity to make a similar in…

4. Use a DCF model and the following data to estimate the per share value (in mi

4. Use a DCF model and the following data to estimate the per share value (in millions, except shares out) Year 1 Year 2 Operating Income Depreciation Cap Ex Other Info Tax Rate L…

4. Use of Funds Like mutual funds, commercial banks and stock-owned savings inst

4. Use of Funds Like mutual funds, commercial banks and stock-owned savings institutions sell shares, but the proceeds received by mutual funds are used in a different way. Explai…

4. Using Spot and Forward Exchange Rates [LO1] Suppose the spot exchange rate fo

4. Using Spot and Forward Exchange Rates [LO1] Suppose the spot exchange rate for the Canadian dollar is Can$1.09 and the six-month forward rate is Can$1.11. a. Which is worth mor…

4. Utilization management is more important for capitated patients than for fee-

4. Utilization management is more important for capitated patients than for fee-for-service patients. a. True b. False 5. Which of the follow statements best describes the contrib…

4. Valuing semiannual coupon bonds Bonds often pay a coupon twice a year. For th

4. Valuing semiannual coupon bonds Bonds often pay a coupon twice a year. For the valuation of bonds that make semiannual payments, the number of periods doubles, whereas the amou…

4. Victory Container Corporation was owned by the three Radin brothers. Two of t

4. Victory Container Corporation was owned by the three Radin brothers. Two of those brothers also owned the Warrensburg Paper and Board Corporation. Victory had no direct ownersh…

4. Weighted average cost of capital (WACC) Howard Industries has a target capita

4. Weighted average cost of capital (WACC) Howard Industries has a target capital structure consisting of 30% debt, 15% preferred stock, and 55% common equity. The before-tax YTM …

4. Weisbach Electronics is considering investing in India. Which of the followin

4. Weisbach Electronics is considering investing in India. Which of the following factors would make the company less likely to proceed with the investment? a. The company would h…

4. What are the requirements of section 404 of SOX? a. It requires the senior ma

4. What are the requirements of section 404 of SOX? a. It requires the senior management and the boards of public companies attest to the effectiveness and validly of their financ…

4. What are the requirements of section 404 of SOX? a. It requires the senior ma

4. What are the requirements of section 404 of SOX? a. It requires the senior management and the boards of public companies attest to the effectiveness and validly of their financ…

4. What is NOT TRUE about a call provision for the issuers? a. Inclusion of a ca

4. What is NOT TRUE about a call provision for the issuers? a. Inclusion of a call feature allows issuers to replace an old bond issue with a lower-interest cost issue if interest…

4. What is the payback period of the following project? Initial Investment: $60,

4. What is the payback period of the following project? Initial Investment:             $60,000 Projected life:                      7 years Net cash flows each year: $14,000 6. W…

4. What is the present value of the following annuity? $1,022 every half year at

4. What is the present value of the following annuity? $1,022 every half year at the end of the period for the next 8 years, discounted back to the present at 19.17 percent, compo…

4. When analyzing potential investments, a company adjusts its cost of capital t

4. When analyzing potential investments, a company adjusts its cost of capital to reflect project risk. Projects judged to be of average risk are analyzed using the company’s weig…

4. When job 711 was completed, direct materials totaled $18,237 direct labor, $2

4. When job 711 was completed, direct materials totaled $18,237 direct labor, $23,064 and factory overhead, $12,336, respectively. Units produced totaled 2,823. What are unit cost…

4. When you create their Statement of Cash Flows, will you use the Direct or Ind

4. When you create their Statement of Cash Flows, will you use the Direct or Indirect method? Why? What additional information will you need from your client to be able to create …

4. Which of the following statements about valuing a firm using the APV approach

4. Which of the following statements about valuing a firm using the APV approach is most CORRECT? a. The value of equity is calculated by discounting the horizon value, the tax sh…

4. Which of the following statements are correct concerning a flexible short-ter

4. Which of the following statements are correct concerning a flexible short-term financial policy? 1. A flexible policy is most appropriate when carrying costs are low relative t…

4. Which of the following statements are correct concerning a flexible short-ter

4. Which of the following statements are correct concerning a flexible short-term financial policy? I. A flexible policy is most appropriate when carrying costs are low relative t…

4. Which of the following statements are correct concerning a flexible short-ter

4. Which of the following statements are correct concerning a flexible short-term financial policy? 1. A flexible policy is most appropri to shortage costs. ate when carrying cost…

4. Which of the following statements are correct concerning a flexible short-ter

4. Which of the following statements are correct concerning a flexible short-term financial policy? A flexible policy is most appropriate when carrying costs are low relative to s…

4. Which of the following statements is CORRECT? Assume that the project being c

4. Which of the following statements is CORRECT? Assume that the project being considered has normal cash flows, with one cash outflow att- 0 followed by a series of positive cash…

4. Which of the following statements is CORRECT? a. When diversifiable risk has

4. Which of the following statements is CORRECT? a. When diversifiable risk has been diversified away, the inherent risk that remains is market risk, which is constant for all sto…

4. Which of the following statements is correct? (Points : 1) In general, the NP

4. Which of the following statements is correct? (Points : 1) In general, the NPVs of riskier cash flows should be found using relatively high discount rates. However, if a cash f…

4. Which of the following statements pertaining to Medicaid is correct? a. It is

4. Which of the following statements pertaining to Medicaid is correct? a. It is a government program that provides income for needy elderly individuals b. It is a government prog…

4. Which one of the following statements is correct concerning the cash cycle? A

4. Which one of the following statements is correct concerning the cash cycle? A. The longer the cash cycle, the more likely a firm will need external financing. B. Increasing the…

4. Which statement is CORRECT?_ a) The Crossover Rate is used to compare two rep

4. Which statement is CORRECT?_ a)      The Crossover Rate is used to compare two repeatable projects with different lives. b)      The Equivalent Annual Annuity is the rate at wh…

4. Wil Brothers, a game manufacturer, has a new idea for an adventure game. It c

4. Wil Brothers, a game manufacturer, has a new idea for an adventure game. It can market the game either as a tradtional board game or as an interactive DVD, but not both. Consid…

4. You are a U.S. exporter concerned about your transaction exposure on a recent

4. You are a U.S. exporter concerned about your transaction exposure on a recent sale to an importer in Germany. The invoice, just sent, is for 500,000 euros payable in 60 days, w…

4. You are considering purchasing the preferred stock of a firm but are concerne

4. You are considering purchasing the preferred stock of a firm but are concerned about its capacity to pay the dividend. To help allay that fear, you compute the times-preferred-…

4. You are considering refinancing your current mortgage and you are considering

4. You are considering refinancing your current mortgage and you are considering a loan with a 7% APR that compounds weekly. What is the Effective Annual Rate (EAR) of this loan? …

4. You bought a stock one year ago for $50 per share and sold it today for $55 p

4. You bought a stock one year ago for $50 per share and sold it today for $55 per share. It paid a $1 per share dividend today. a. What was your realized return? b. How much of t…

4. You have $10,000 to invest and you put $8,000 in stock C and $2,000 in stock

4. You have $10,000 to invest and you put $8,000 in stock C and $2,000 in stock D (the two stocks listed in Question 3). What is the beta of your portfolio? What is the expected r…

4. You have a portfollio of stocks that consists of the following: Number of Sha

4. You have a portfollio of stocks that consists of the following: Number of Shares Price 200 300 1000 Risk-free rate 2.00% Risk Premium on the market» 5.00% Beta $Value weight 1.…

4. You have been asked by the president of your company to evaluate the proposed

4. You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck. The truck’s basic price is $50,000 and it will cost an…

4. You have been given the probability distribution for the holding period retur

4. You have been given the probability distribution for the holding period return of CCC Inc. stock: State of the Economy Boom Normal Recession Assuming that the expected return o…

4. You have been recently appointed as a corporate manager in EXIM Bank Malaysia

4. You have been recently appointed as a corporate manager in EXIM Bank Malaysia. Your new corporate client, the Limkokwing University of Creative Technology Sdn. Bhd. Malaysia, h…

4. You have run a regression of monthly returns on a stock against monthly retur

4. You have run a regression of monthly returns on a stock against monthly returns on the S&P; 500 index, and come up with the following output Rstock:0.26% + 1.74 * RMarket R…

4. You just bought a rent house in Fayetteville, AR, for $200,000, with S40,000

4. You just bought a rent house in Fayetteville, AR, for $200,000, with S40,000 down and the balance in the form of a 15-year amortization mortgage at a fixed rte of 4.0% and mont…

4. You know the payment amount for a loan and you want to know how much was borr

4. You know the payment amount for a loan and you want to know how much was borrowed. a. Do you compute a present value or a future value? 5. You want to receive $5,000 per month …

4. You own an oil pipeline which will generate a $2 million cash return over the

4. You own an oil pipeline which will generate a $2 million cash return over the coming year. The pipeline’s operating costs are negligible, and it is expected to last for a very …

4. You recently approached your bank about establishing a credit line facility.

4. You recently approached your bank about establishing a credit line facility. The terms offered by your bank include a nominal rate of prime + 1.5% (prime is currently 5%) on th…

4. You spent and you are trying to deci analyzing the brake pent S500 last week

4. You spent and you are trying to deci analyzing the brake pent S500 last week fixing the transmisson in your car. Now, the brakes are acting up analyzing the brake deside whethe…

4. You want to buy a house worth $4,500,000, and the a down payment of 30% of th

4. You want to buy a house worth $4,500,000, and the a down payment of 30% of the value of the house. lenders require that you make (i). Work out the amount of the mortgage loan t…

4. You\'ve decided to sell sweatshirts for the upcoming game. You proect that at

4. You've decided to sell sweatshirts for the upcoming game. You proect that at a price of $31.24 per sweatshirt, you will be able to sell 120 shirts. In order to sell 350 sweatsh…

4. Your analysis leads you to believe that the price of Outel\'s stock should be

4. Your analysis leads you to believe that the price of Outel's stock should be $40 per share. Its current market price is $30. a) If you do not believe that you have access to sp…

4. Your boss has asked you to take a closer look at your company’s credit polici

4. Your boss has asked you to take a closer look at your company’s credit policies. You have been given the following information: a) Your firm’s DSO is: ______________ b) Taggart…