Financial literacy

1. Siclan Company Problem The Siclan Company is considering opening a new office

1. Siclan Company Problem The Siclan Company is considering opening a new office. The company owns the building and would sell it for $74,000 after taxes if it does not open the n…

1. Silver Dart Lodge Inc. sold an issue of 25-year, $1,000 par value bonds to th

1. Silver Dart Lodge Inc. sold an issue of 25-year, $1,000 par value bonds to the public. The bonds has a 7.25% coupon rate and pays interest annually. The current market rate of …

1. Simon inc. Just issued a dividend of $2.61 per share on its stock. Analyst ex

1. Simon inc. Just issued a dividend of $2.61 per share on its stock. Analyst expect simon's dividend to grow indefinitely at a constant rate of 5% per year. If the stocks current…

1. Simple versus compound interest Aa Aa Financial contracts involving investmen

1. Simple versus compound interest Aa Aa Financial contracts involving investments, mortgages, loans, and so on are based on either a fixed or a variable interest rate. Assume tha…

1. Simple versus compound interest AaAa Financial contracts involving investment

1. Simple versus compound interest AaAa Financial contracts involving investments, mortgages, loans, and so on are based on ether a fixed or a variable interest rate. Assume that …

1. Sinan is considering investing in a project with an initial cost of $44,000 a

1. Sinan is considering investing in a project with an initial cost of $44,000 and a four-year life span. Sinan will depreciate the assets to zero on a straight-line basis over th…

1. Sixty years ago, your grandparents opened two savings accounts and deposited

1.Sixty years ago, your grandparents opened two savings accounts and deposited $200 in each account. The first account was with City Bank at 3 percent, compounded annually. The se…

1. Skip Town borrowed $20,000 at a rate of 12% compounded monthly. He was suppos

1. Skip Town borrowed $20,000 at a rate of 12% compounded monthly. He was supposed to pay it back in 60 equal payments over the next 5 years. However, immediately after his 30th p…

1. Snacks Inc. has a mean expected return of 15%, with a standard deviation of 2

1. Snacks Inc. has a mean expected return of 15%, with a standard deviation of 2%. The CFO is going to the bank to discuss a large loan. The banker asks what range of returns, wit…

1. Solar Engines manufactures solar engines for tractor-trailers. Given the fuel

1. Solar Engines manufactures solar engines for tractor-trailers. Given the fuel savings available, new orders for 120 units have been made by customers requesting credit. The var…

1. Some time ago, Vanessa purchased eleven acres of land costing $58,500. Today,

1. Some time ago, Vanessa purchased eleven acres of land costing $58,500. Today, that land is valued at $253,167. How long has she owned this land if the price of the land has bee…

1. Speculation. Diamond Bank expects that the Singapore dollar will depreciate a

1. Speculation. Diamond Bank expects that the Singapore dollar will depreciate against the dollar from its spot rate of $.43 to $.42 in 60 days. The following interbank lending an…

1. Speculation. Diamond Bank expects that the Singapore dollar will depreciate a

1. Speculation. Diamond Bank expects that the Singapore dollar will depreciate against the dollar from its spot rate of $.43 to $.42 in 60 days. The following interbank lending an…

1. Spiess Corporation\'s 12%, $1000 bonds mature in 10 years. The company can ca

1. Spiess Corporation's 12%, $1000 bonds mature in 10 years. The company can call the bonds in five years if it pay bondholders a call premium of 12 percent. What should Spiess's …

1. Spotify bonds currently sell for $1,250. They pay a $90 annual coupon, have a

1. Spotify bonds currently sell for $1,250. They pay a $90 annual coupon, have a 25-year maturity, and a $1,000 par value, but they can be called in 5 years at $1,050. Assume that…

1. Start with total revenue, and subtract cost of goods sold to calculate gross

1. Start with total revenue, and subtract cost of goods sold to calculate gross margin. 2. Subtract total expenses from gross margin to calculate net profit. Your task is to creat…

1. Starting with the economy in long-run equilibrium, use the aggregate demand-a

1. Starting with the economy in long-run equilibrium, use the aggregate demand-aggregate supply framework to illustrate what would happen to inflation and output in the short run …

1. State of Nature.........Probability........State Dependent Return A.........S

1. State of Nature.........Probability........State Dependent Return A.........State Dependent Return B Recession....................70%..........................-.08.............…

1. Statistical measures of standalone risk Aa Aa Remember, the expected value of

1. Statistical measures of standalone risk Aa Aa Remember, the expected value of a probability distribution is a statistical measure of the average (mean) value expected to occur …

1. Stellar Company has the following sales, variable cost, and fixed cost. If sa

1. Stellar Company has the following sales, variable cost, and fixed cost. If sales increase by $10,000 then their profit increases/decreases by how much? Sales $50,000 Variable C…

1. Stephanie Enterprises has bonds that have a 9 percent coupon rate. The intere

1. Stephanie Enterprises has bonds that have a 9 percent coupon rate. The interest is paid semiannually and the bonds mature in 8 years. Their par value is $1,000. The prices of t…

1. Stephanie is an investor who believes that the real key to a company\'s futur

1. Stephanie is an investor who believes that the real key to a company's future stock price lies in its future earnings. When investing in a company, she carefully studies its fu…

1. Stephanie would like to purchase a bond that has a par value of $1,000, pays

1. Stephanie would like to purchase a bond that has a par value of $1,000, pays $80 at the end of each year in coupon payments, and has ten years remaining until maturity. If the …

1. Steve just computed the present value of a $10,000 bonus he will receive in t

1. Steve just computed the present value of a $10,000 bonus he will receive in the future. The interest rate he used in this process is referred to as which one of the following? …

1. Still Boston DuckBoat Company. The company just paid a cash dividend of $0.50

1. Still Boston DuckBoat Company. The company just paid a cash dividend of $0.50 per share. What will be the new share price after the dividend payment? a. $5.50 b. $74.50 c. $75.…

1. Stock A has a beta of 1.2 and a standard deviation of returns of 18%. Stock B

1. Stock A has a beta of 1.2 and a standard deviation of returns of 18%. Stock B has a beta of 1.8 and a standard deviation of returns of 18%. If the market risk premium increases…

1. Stock A\'s beta is 1.7 and Stock B\'s beta is 0.7. Which of the following sta

1.        Stock A's beta is 1.7 and Stock B's beta is 0.7. Which of the following statements must be true about these securities? (Assume market equilibrium.) a.        Stock B mu…

1. Stock Y has a beta of 1.05 and an expected return of 13.10 percent. Stock Z h

1. Stock Y has a beta of 1.05 and an expected return of 13.10 percent. Stock Z has a beta of 0.70 and an expected return of 7 percent. If the risk-free rate is 5.0 percent and the…

1. Stock Y has a beta of 1.05 and an expected return of 13.10 percent. Stock Z h

1. Stock Y has a beta of 1.05 and an expected return of 13.10 percent. Stock Z has a beta of 0.70 and an expected return of 7 percent. If the risk-free rate is 5.0 percent and the…

1. Stock. What is the value of a stock with a a. $2 dividend just paid and an 8%

1. Stock. What is the value of a stock with a a. $2 dividend just paid and an 8% required return with 0%growth? b. $3 dividend just paid and a 9% required return with 1%growth? c.…

1. Stockholders invested $14,289 cash in the business in exchange for common sto

1. Stockholders invested $14,289 cash in the business in exchange for common stock. 2. Purchased equipment for $5,376 cash. 3. Paid $460 cash for May office rent. 4. Paid $634 cas…

1. Stocks A, B, and C have expected returns of 14 percent, 14 percent, and 10 pe

1. Stocks A, B, and C have expected returns of 14 percent, 14 percent, and 10 percent, respectively, while their standard deviations are 49 percent, 25 percent, and 25 percent, re…

1. Striving to maximize the size of the firm is not considered the most theoreti

1. Striving to maximize the size of the firm is not considered the most theoretically correct objective for a financial manager to pursue. The reasons for this include the fact th…

1. Sultan Services has 1.2 million shares outstanding. It expects earnings at th

1. Sultan Services has 1.2 million shares outstanding. It expects earnings at the end of the year of $5.6 million. Sultan pays out 60% of its earnings in total - 40% paid out as d…

1. Summary balance sheet data for Greener Gardens Co. is shown below (in thousan

1.        Summary balance sheet data for GreenerGardens Co. is shown below (in thousands of dollars). The company is in a highly seasonalbusiness, and the data show its assetsand …

1. Summer Co. currently has 330,000 shares of stock outstanding that sell for $6

1. Summer Co. currently has 330,000 shares of stock outstanding that sell for $64 per share. Assuming no market imperfections or tax effects exist, what will the share price be af…

1. Suppose Congress decided to void the Modified Accelerated Cost Recovery Syste

1. Suppose Congress decided to void the Modified Accelerated Cost Recovery System (MACRS) and replace it with the Straight Line Depreciation Method. What would be the effect on th…

1. Suppose Einar Ace buys 100 shares of Nordic Power Corp. at $20 each. The clea

1. Suppose Einar Ace buys 100 shares of Nordic Power Corp. at $20 each. The clear inghouse NASDUCK sets a margin requirement of 50% and charges an interest rate of 5% on the loan …

1. Suppose ICT stock has a volatility (standard deviation) of 40%, and an expect

1. Suppose ICT stock has a volatility (standard deviation) of 40%, and an expected return of 16%. DFW stock has a volatility of 20%, and an expected return of 10%. ICT and DFW hav…

1. Suppose Joe has the choice of two investments. He can invest in a bond, which

1. Suppose Joe has the choice of two investments. He can invest in a bond, which in 10 years (not accounting for inflation), will have a 50% probability of a 50% return and a 50% …

1. Suppose Joe has the choice of two investments. He can invest in a bond, which

1. Suppose Joe has the choice of two investments. He can invest in a bond, which in 10 years (not accounting for inflation), will have a 50% probability of a 50% return and a 50% …

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e.,

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e., C0 =             -2,600,000) on a new project that is expected to last for 7 years. The project is …

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e.,

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e., C0 = -2,600,000) on a new project that is expected to last for 7 years. The project is expected to …

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e.,

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e., C0 = -2,600,000) on a new project that is expected to last for 7 years. The project is expected to …

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e.,

1. Suppose Palmer Properties is considering investing $2.6 million today (i.e., C0 =-2,600,000) on a new project that is expected to last for 7 years. The project is expected to g…

1. Suppose Palmer Properties is considering investing $3.6 million today (i.e.,

1. Suppose Palmer Properties is considering investing $3.6 million today (i.e., C0 =             -3,600,000) on a new project that is expected to last for 9 years. The project is …

1. Suppose Palmer Properties is considering investing $3.6 million today (i.e.,

1. Suppose Palmer Properties is considering investing $3.6 million today (i.e., C0 = -3,600,000) on a new project that is expected to last for 9 years. The project is expected to …

1. Suppose a State of Missouri bond will pay $10,000 when it matures 5 years fro

         1. Suppose a State of Missouri bond will pay $10,000 when it matures 5 years from now. This is a zero-coupon bond, which means that there are no interest payments between…

1. Suppose a U.S. treasury bond will pay $2,500 five years from now. If the goin

1.     Suppose a U.S. treasury bond will pay $2,500 five years from now. If the going interest rate on 5-year treasury bonds is 4.25%, how much is the bond worth today? 2.     Fiv…

1. Suppose a U.S. treasury bond will pay $2,500 five years from now. If the goin

1.     Suppose a U.S. treasury bond will pay $2,500 five years from now. If the going interest rate on 5-year treasury bonds is 4.25%, how much is the bond worth today? 2.     Fiv…