Financial literacy

A. (Organizing cash flows, NPV, IRR) A company is evaluating the purchase of Mac

A. (Organizing cash flows, NPV, IRR) A company is evaluating the purchase of Machine A. The new machine would cost $120,000 and would be depreciated for tax purposes using the str…

A. 0 C. Infinity. 3) As the compounding rate becomes lower and lower, the future

A. 0 C. Infinity. 3) As the compounding rate becomes lower and lower, the future value of inflows approachers B. the present value of the inflows. D. More information is needed to…

A. 150; B. 100; C. 75; D. 40; E. 35 45. An American purchased us$1,000 worth of

A. 150; B. 100; C. 75; D. 40; E. 35 45. An American purchased us$1,000 worth of British Pounds Sterling from a foreign exchange (forex) broker to buy British Auto (ticker: BA) sto…

A. 3.4% B. 3.9% C. 4.3% D. 5% Question 16 of 17 1 Points A. 5.4% B. 6% C. 7.4% D

A. 3.4% B. 3.9% C. 4.3% D. 5% Question 16 of 17 1 Points A. 5.4% B. 6% C. 7.4% D. 9.2% Question 17 of 17 1 Points A. 5.4% B. 5.8% C. 6.1% D. 6.5% In questions 15 to 17 suppose ABC…

A. A bond has a par value of $1,000, a time to maturity of 20 years, and a coupo

A. A bond has a par value of $1,000, a time to maturity of 20 years, and a coupon rate of 7.50% with interest paid annually. If the current market price is $750, what will be the …

A. A fixed asset is classified as 5-year MACRS property and has an initial cost

A. A fixed asset is classified as 5-year MACRS property and has an initial cost of $41,000 What is the aftertax cash flow from the sale of this asset if the pre-tax salvage value …

A. A listed call option contract for IBM with an exercise price of $148 has a pr

A. A listed call option contract for IBM with an exercise price of $148 has a price quote of $7.20. If you buy this option and hold it to expiration, the contract will generate a …

A. A project has an initial cost of $57,200 and is expected to produce cash infl

A. A project has an initial cost of $57,200 and is expected to produce cash inflows of $19,800, $27,900, and $45,200 over the next 3 years, respectively. What is the project’s int…

A. A six-month S&P 500 index call option has an exercise price of 1,500. The hol

A. A six-month S&P 500 index call option has an exercise price of 1,500. The holder of the option exercises the call when the index is at 1,520. The settlement procedure for t…

A. A stock has been trading at $37.50 per share for some time. It would make sen

A. A stock has been trading at $37.50 per share for some time. It would make sense for an investor to enter a limit buy order at ______ per share or a limit sell order at ______ p…

A. A store offers two payment plans. Under the installment plan, you pay 20% dow

A. A store offers two payment plans. Under the installment plan, you pay 20% down and 20% of the purchase price in each of the next 5 years. If you pay the entire bill immediately…

A. A week ago Peter purchased 7 American put option contract on TESCO for f3.75

A. A week ago Peter purchased 7 American put option contract on TESCO for f3.75 per option per share. This contract expires in 4 r onths. At the same tirne Peter also owns 7,000 s…

A. Abbreviated financial Statements for Archimedes Levers are shown in the follo

A. Abbreviated financial Statements for Archimedes Levers are shown in the following table. If sales increase by 10% in 2011 and all other items, including debt, increase correspo…

A. Acronyms Define each of the following acronyms FoHFs: PPNs: B. Calculations 1

A. Acronyms Define each of the following acronyms FoHFs: PPNs: B. Calculations 1. At the start of Year 1, the hedge fund run by DKE Management inc. had $100 million in net assets.…

A. Alpha and the CAPM A stock with a beta of 0.77 has an expected return of 12%

A. Alpha and the CAPM A stock with a beta of 0.77 has an expected return of 12% and an alpha of 1.5% when the market expected return is 13% . What must be the risk free rate that …

A. An open-end fund has a net asset value of $11.10 per share. It is sold with a

A. An open-end fund has a net asset value of $11.10 per share. It is sold with a front-end load of 8%. What is the offering price? (Round your answer to 2 decimal places.) B.If th…

A. Annual risk-free rate is 4%. Annual expected return on market portfolio is 12

A. Annual risk-free rate is 4%. Annual expected return on market portfolio is 12% and stock S has a Beta of 0.5. Predict with CAPM the annual expected return on S? B. The Expected…

A. B Please analyze the NPV and IRR of spreadsheet A and spreadsheet B. Debt: No

A. B Please analyze the NPV and IRR of spreadsheet A and spreadsheet B. Debt: No of Bonds 7,000 Tenure(Yr) 18 Kd 4.60% Cost of Debt Face value of Bond $1,000 Coupon 5% Semi-Annual…

A. Bad Boys, Inc. is evaluating its cost of capital. Under consultation, Bad Boy

A. Bad Boys, Inc. is evaluating its cost of capital. Under consultation, Bad Boys, Inc. expects to issue new debt at par with a coupon rate of 8% and to issue new preferred stock …

A. Beta and Value A firm is expected to pay an annual dividend of $.80 next year

A. Beta and Value A firm is expected to pay an annual dividend of $.80 next year. After next year the firm’s dividends will grow at a steady state rate of 6% per year. You are try…

A. BlockOut Co. has 78,543 bonds outstanding that are selling at par value. The

A. BlockOut Co. has 78,543 bonds outstanding that are selling at par value. The bonds yield 8.2 percent. The company also has 5.2 million shares of common stock outstanding. The s…

A. Bond Prices A $1,000 par bond that pays interest semiannually has a quoted co

A. Bond Prices A $1,000 par bond that pays interest semiannually has a quoted coupon rate of 7%, a promised yield to maturity of 7.6% and exactly 4 years to maturity. What is the …

A. CAPM Implications The CAPM implies that I. all investors who invest in risky

A. CAPM Implications The CAPM implies that I. all investors who invest in risky assets will hold the same portfolio of risky assets. II. the risk premium of an individual security…

A. Calculate the annual cash flows (annuity payments) from a fixed-payment annui

A. Calculate the annual cash flows (annuity payments) from a fixed-payment annuity if the present value of the 25-year annuity is $1.9 million and the annuity earns a guaranteed a…

A. Calculate the mean and standard deviation of the following securities’ return

A. Calculate the mean and standard deviation of the following securities’ returns: Year Computroids Inc. Blazers Inc. 1 10% 5% 2 5% 6% 3 –3% 7% 4 12% 8% 5 10% 9% B. Assuming these…

A. Calculate the present value of bond A if the required rate of return is 6% ,

A. Calculate the present value of bond A if the required rate of return is 6% , 9% and 12% B. Calculate the present value of bond B of the required rate of return is 6% 9% and 12%…

A. Calculate the price of a bond with the following characteristics. Coupon: 5.0

A. Calculate the price of a bond with the following characteristics. Coupon: 5.00% Maturity: 4 Years Par Amount: $1,000 Required Return: 4.00% B. Calculate the duration and modifi…

A. Capital Allocation Lines The optimal CAL is found as the ray from the risk fr

A. Capital Allocation Lines The optimal CAL is found as the ray from the risk free rate that is tangent to the _____________ and is called the ________________. efficient frontier…

A. Captain Crunch, Inc. is looking at a project that will cost $550,000 and last

A. Captain Crunch, Inc. is looking at a project that will cost $550,000 and last 5 years. A first analysis used straight line depreciation, but if $200,000 was recognized in year …

A. Chapter 15 discusses problems with the overall capitalization technique when

A. Chapter 15 discusses problems with the overall capitalization technique when there is likely to be a discontinuity in the rate of change in a property’s operating results. What…

A. ClassCo sells Convertible Bond with warrant to convert into stock Bond with f

A. ClassCo sells Convertible Bond with warrant to convert into stock Bond with face $1,000 Face Rate 8.00% Term 3 Yrs. Market rate @ sale 8.50% issued: 30/06/18 maturity 30/06/21 …

A. Consider a mutual fund with $206 million in assets at the start of the year a

A. Consider a mutual fund with $206 million in assets at the start of the year and with 20 million shares outstanding. The fund invests in a portfolio of stocks that provides divi…

A. Consider an asset that costs $264,000 and is depreciated straight-line to zer

A. Consider an asset that costs $264,000 and is depreciated straight-line to zero over its 12-year tax life. The asset is to be used in a 5-year project; at the end of the project…

A. Consider the following cash flows for the two investments. What are the payba

A. Consider the following cash flows for the two investments. What are the payback periods on the two investments? Answer options: Project A 1.58 years; Project B 2.06 year Projec…

A. Create a set of 5 points that are very close together and record the standard

A. Create a set of 5 points that are very close together and record the standard deviation. Next, add a sixth point that is far away from the original 5 and record the new standar…

A. Del Monty will receive the following payments at the end of the next three ye

A. Del Monty will receive the following payments at the end of the next three years: $13,000, $16,000, and $18,000. Then from the end of the 4th year through the end of the 10th y…

A. Denver Interiors has 67,000 shares of common stock outstanding at a price per

A. Denver Interiors has 67,000 shares of common stock outstanding at a price per share of $39. The firm also has 23,500 shares of preferred stock outstanding at a price per share …

A. Estimating Index Model Coefficients An analyst estimates a security character

A. Estimating Index Model Coefficients An analyst estimates a security characteristic line using a single index model and finds the following statistics: We know from the results …

A. Evaluating the CAPM Which one of the following statements implied by the CAPM

A. Evaluating the CAPM Which one of the following statements implied by the CAPM is not true? Systematic risk is the risk that matters. Investors should diversify. A similar well …

A. Ex-Post Standard Deviation A stock had historical monthly returns of -3%, 1%,

A. Ex-Post Standard Deviation A stock had historical monthly returns of -3%, 1%, 1.50%, 2%,-2% and 4%. Based on this data, the stock would have an annual expected return of ______…

A. Explain the difference between a bid price and an asked price and also explai

A. Explain the difference between a bid price and an asked price and also explain why the prices are different. Maturity: 8/15/2019, Coupon:  8.250, Bid: 142:10, Asked: 142:15, Ch…

A. Find the FV of $1,000 invested to earn 10% after 5 yrs. Answer thisquestion b

A. Find the FV of $1,000 invested to earn 10% after 5 yrs. Answer thisquestion byusing a math formula and also by using theExcel function wizard. B. Now create a table that shows …

A. Find the FV of $1,000 invested to earn 10% after 5 yrs. Answer thisquestion b

A. Find the FV of $1,000 invested to earn 10% after 5 yrs. Answer thisquestion byusing a math formula and also by using theExcel function wizard. B. Now create a table that shows …

A. Fuhs Pastries, Inc has 12% annual coupon bonds outstanding with 11 years rema

A. Fuhs Pastries, Inc has 12% annual coupon bonds outstanding with 11 years remaining until maturity. The current price fo the bonds are $1,329. What is Fuhs' cost of debt? B. Pac…

A. Given the following information about the returns of stocks A, B, and C, what

A. Given the following information about the returns of stocks A, B, and C, what is the expected return of a portfolio invested 30% in stock A, 40% in stock B, and 30% in stock C?…

A. Grand Adventure Properties offers a 9.5 percent coupon bond with annual payme

A. Grand Adventure Properties offers a 9.5 percent coupon bond with annual payments. The yield to maturity is 10 percent and the maturity date is 12 years from today. What is the …

A. Growth and Value A firm has projected earnings of $6 per share for next year

A. Growth and Value A firm has projected earnings of $6 per share for next year and has a 30% dividend payout ratio. The firm's required return is 13%. The firm's ROE is 14%. What…

A. How do you interpret Net Opearting Profit after Tax for 2016 and 2015? What i

A. How do you interpret Net Opearting Profit after Tax for 2016 and 2015? What is the performance on the calculations based on your analysis? B. How do you interpret Net Opearting…

A. How do you interpret Net Opearting Profit after Tax for 2016 and 2015? What i

A. How do you interpret Net Opearting Profit after Tax for 2016 and 2015? What is the performance on the calculations based on your analysis? B. How do you interpret Net Opearting…

A. How do you manage you food supply, 1) within the refrigerator and 2) cabinets

A. How do you manage you food supply, 1) within the refrigerator and 2) cabinets? B. How does your frequency of resupply (go to the store) impact inventory. C. How does shelf like…