Financial literacy

1. Change variable cost for flexible budget to suit new volume of visits (calcul

1. Change variable cost for flexible budget to suit new volume of visits (calculate a per visit cost with the original volumes, then increase to the new volume) 2. Fill in table 3…

1. Charles River Associates is considering whether to call either of the two per

1. Charles River Associates is considering whether to call either of the two perpetual bond issues the company currently has outstanding. If the bond is called, it will be refunde…

1. Chef X wants to start a restaurant in Exeter, and asks local bank Y for a loa

1. Chef X wants to start a restaurant in Exeter, and asks local bank Y for a loan of £40. X has no liquid assets and is risk neutral. X and Y can not agree on the type and name of…

1. Chen\'s Department Store Chen\'s Department Store is a merchandising company

1. Chen's Department Store Chen's Department Store is a merchandising company that uses the periodic inventory system. Selected account balances are listed below: Refer to the acc…

1. Choose two companies in the same industry that you are interested in. (a) Whi

1. Choose two companies in the same industry that you are interested in. (a) Which industry are you interested in? (b) Provide summary of two companies. Include names, Ticker symb…

1. Christian and Sarah both graduate from OSU and begin working as financial ana

1. Christian and Sarah both graduate from OSU and begin working as financial analysts. They will both work for exactly 40 years and then retire. Both plan to save for retirement, …

1. Christopher electronics bought new machinery for $5,045,000 million. This is

1. Christopher electronics bought new machinery for $5,045,000 million. This is expected to result in additional cash flows of $1,225,000 million over the next 7 years. What is th…

1. Cnooc, a Chinese public-sector company, has made a bid to purchase Unocal, a

1. Cnooc, a Chinese public-sector company, has made a bid to purchase Unocal, a big U.S oil company, for $18.5 billion in June 2005. Treat this as an initial investment made by Cn…

1. Coffee Co. determines its losses have the following distribution: a. Sketch t

1. Coffee Co. determines its losses have the following distribution: a. Sketch the probability distribution and comment on the shape of the distribution (skew and kurtosis) [no ca…

1. Collateral a. reduces the need for credit analysis of the borrower b. arrange

1. Collateral a. reduces the need for credit analysis of the borrower b. arrangements include floating liens, warehouse receipts, and floor planning c. is required on unsecured lo…

1. Come and Go Bank offers your firm a discount interest loan with an interest r

1. Come and Go Bank offers your firm a discount interest loan with an interest rate of 10 percent for up to $26 million, and in addition requires you to maintain a 2 percent compe…

1. Comment on the following quote from the L.A. Times: The unusual $200-per-shar

1. Comment on the following quote from the L.A. Times: The unusual $200-per-share offer that Teledyne Inc. made Wednesday for at least 25% of the its common stock has astounded ev…

1. Commercial paper is issued by large firms with excellent credit ratings all f

1. Commercial paper is issued by large firms with excellent credit ratings all firms the federal government small firms with excellent credit ratings 2. A financial lease is simil…

1. Common Products has issued its $.0001 par value stock in three separate finan

1. Common Products has issued its $.0001 par value stock in three separate financing transactions. First, ten years ago, the founder of the company purchased 1,000,000 shares of s…

1. Common Products has issued its $.0001 par value stock in two separate financi

1. Common Products has issued its $.0001 par value stock in two separate financing transactions. Transaction 1: five years ago, the founder of the company purchased 4,000,000 shar…

1. Common Products has issued its $.001 par value stock in two separate financin

1. Common Products has issued its $.001 par value stock in two separate financing transactions. Transaction 1: five years ago, the founder of the company purchased 2,000,000 share…

1. Common Products has issued its $.002 par value stock in two separate financin

1. Common Products has issued its $.002 par value stock in two separate financing transactions. Transaction 1: ten years ago, the founder of the company purchased 10,000,000 share…

1. Common Products has issued its $.002 par value stock in two separate financin

1. Common Products has issued its $.002 par value stock in two separate financing transactions. Transaction 1: ten years ago, the founder of the company purchased 10,000,000 share…

1. Community Hospital has annual net patient revenues of $150 million. At the pr

1. Community Hospital has annual net patient revenues of $150 million. At the present time, payments received by the hospital are not deposited for six days on average. The hospit…

1. Companies A and B have been offered the following rates per annum on a $10 mi

1. Companies A and B have been offered the following rates per annum on a $10 million 5-year investment: Fixed rate Floating rate Company A 10.0% LIBOR Company B 10.8% LIBOR Compa…

1. Companies U and L are identical in every respect except that U is unlevered w

1. Companies U and L are identical in every respect except that U is unlevered while L has $10 million of 4.2% bonds outstanding. Assume that (1) all of the MM assumptions are met…

1. Companies engaged in international business often face this issue. Typically,

1. Companies engaged in international business often face this issue. Typically, companies will turn to banks or investors to obtain financing. This works of course, but it can ti…

1. Company A and Company B are identical in size and capital structure. However,

1. Company A and Company B are identical in size and capital structure. However, the riskiness of their assets and cash flows are somewhat different, resulting in A having a WACC …

1. Company A just paid a dividend of $2.00. The risk-free rate of return is 1% a

1. Company A just paid a dividend of $2.00. The risk-free rate of return is 1% and the market risk premium is 12%. The beta of the company's stock is 1.20. If you know the company…

1. Company X has an equity market-to-book ratio of 1.4. Assuming the market valu

1. Company X has an equity market-to-book ratio of 1.4. Assuming the market value equals its book value, what weights should it use for its WACC calculation? Assets= $1040, Debt=$…

1. Compare and contrast credit risk with liquidity risk. 2. Describe the size, s

1. Compare and contrast credit risk with liquidity risk. 2. Describe the size, structure and composition of the mutual fund industry. Do you consider these characteristics as havi…

1. Comparing Jobs Mr. A, an Indian national has got two job offers after complet

1. Comparing Jobs Mr. A, an Indian national has got two job offers after completing his MBA degree. One offer is from an Indian company and pays him 10,000,000 INR (Indian Rupees)…

1. Complete the missing information for the selected balance sheet accounts base

1. Complete the missing information for the selected balance sheet accounts based on the following ratios Debt Ratio 50% Tot Liab / Tot Asset Quick Ratio .80X (CA-Inv)/CL Total As…

1. Compute WACC, given the following: $130MM in debt with interest payments of 7

1. Compute WACC, given the following: $130MM in debt with interest payments of 7.18% but the ability to borrow at 6.79%, $36MM in preferred equity priced at $18.02 per share with …

1. Compute the Cost of Equity for XYZ Inc. 2. Compute the WEIGHTED AVERAGE after

1. Compute the Cost of Equity for XYZ Inc. 2. Compute the WEIGHTED AVERAGE after-tax cost of debt (short term and long term combined) for XYZ Inc. 3. Compute the Weights for Short…

1. Compute the IRR static for Project E. The appropriate cost of capital is 8 pe

1. Compute the IRR static for Project E. The appropriate cost of capital is 8 percent. (Do not round intermediate calculations and round your final answer to 2 decimal places.)   …

1. Compute the NPV for Project K if the appropriate cost of capital is 5 percent

1. Compute the NPV for Project K if the appropriate cost of capital is 5 percent. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Rou…

1. Compute the NPV for Project M if the appropriate cost of capital is 9 percent

1. Compute the NPV for Project M if the appropriate cost of capital is 9 percent. (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Rou…

1. Compute the WACC for A.A.T. Bass & Co. using the information below: Book valu

1. Compute the WACC for A.A.T. Bass & Co. using the information below: Book value of bonds = $800 million   Maturity date = February, 2028 Equity beta = 1.30 Shares outstandin…

1. Compute the annual interest payments and principal amount for a Treasury Infl

1. Compute the annual interest payments and principal amount for a Treasury Inflation-Protected Security with a par value of $1000 and a 3 percent interest rate if inflation is 4 …

1. Compute the correlation and covariance between the return on company #12 and

1. Compute the correlation and covariance between the return on company #12 and the return on the equally-weighted portfolio.   2. Compute the beta of Company #12 using the inform…

1. Compute the expected return and standard deviation. (Do not round intermediat

1.    Compute the expected return and standard deviation. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) 2. An investor owns $5,000 of Adob…

1. Compute the price of a 7.5 percent coupon bond with ten years left to maturit

1. Compute the price of a 7.5 percent coupon bond with ten years left to maturity and a market interest rate of 8.0 percent. (Assume interest payments are semiannual. (Do not roun…

1. Compute the price of an American call option with strike K =110 and maturity

1. Compute the price of an American call option with strike K=110 and maturity T=.25 years. 2. Compute the price of an American put option with strike K=110 and maturity T=.25 yea…

1. Compute the specified quantity. At auction, 9-month T-bills were sold at a di

1. Compute the specified quantity. At auction, 9-month T-bills were sold at a discount of 7.425%. What was the simple annual yield r? HINT [See Example 5.] (Round your answer to t…

1. Concepts used in cash flow estimation and risk analysis Aa Aa You can come ac

1. Concepts used in cash flow estimation and risk analysis Aa Aa You can come across different situations in your life where the concepts from capital budgeting will help you in e…

1. Concepts used in cash flow estimation and risk analysis Aa Aa You can come ac

1. Concepts used in cash flow estimation and risk analysis Aa Aa You can come across different situations in your life where the concepts from capital budgeting will help you in e…

1. Concepts used in cash flow estimation and risk analysis You can come across d

1. Concepts used in cash flow estimation and risk analysis You can come across different situations in your life where the concepts from capital budgeting will help you in evaluat…

1. Consider a 10000 par value, 4 year bond bearing a 5% nominal semiannual coupo

1. Consider a 10000 par value, 4 year bond bearing a 5% nominal semiannual coupon rate. Coupons pay out every six-month period, starting six months after the bond is purchased. Th…

1. Consider a European call option when the stock price is $30, the exercise pri

1. Consider a European call option when the stock price is $30, the exercise price is $25, the time to maturity is 6 months, the volatility is 35% per annum, and the risk-free rat…

1. Consider a bond with a 5.6 percent coupon rate and a yield to call of 6.5 per

1. Consider a bond with a 5.6 percent coupon rate and a yield to call of 6.5 percent. The bond currently sells for $1,096. If the bond is callable in 5 years, what is the call pre…

1. Consider a coupon bond that has a $1,000 par value and a coupon rate of 8% (s

1. Consider a coupon bond that has a $1,000 par value and a coupon rate of 8% (semiannual payment) The bond is currently selling for $1,180 and has 9 years to maturity. What is th…

1. Consider a local park. The value of a trip to this park to any individual dep

1. Consider a local park. The value of a trip to this park to any individual depends on how many other people also visit the park. For the first six visitors, the value of a trip …

1. Consider a project to supply Detroit with 40,000 tons of machine screws annua

1. Consider a project to supply Detroit with 40,000 tons of machine screws annually for automobile production. You will need an initial $5,400,000 investment in threading equipmen…

1. Consider a standard project whose NPV is exactly $0. Which of the following i

1. Consider a standard project whose NPV is exactly $0. Which of the following is true of the same project’s internal rate of return if the required rate of return is 14%? a. The …