Financial literacy

1. Suppose your firm is considering two mutually exclusive, required projects wi

1.      Suppose your firm is considering two mutually exclusive, required projects with the cash flows shown as follows. The required rate of return on projects of both of their r…

1. Suppose your grandmother invested some money in 1925. Based on historical ret

1. Suppose your grandmother invested some money in 1925. Based on historical returns from 1925 to 2015, what of the following types of securities would have given her the SECOND h…

1. Suppose your portfolio is comprised of 1,000 shares of American Airlines, 1,0

1. Suppose your portfolio is comprised of 1,000 shares of American Airlines, 1,000 shares of Delta Airlines, and 1,000 shares of United Airlines. The beta for American is 3.85, fo…

1. Swenson Markets would like to sell an additional 1,000 shares of stock using

1. Swenson Markets would like to sell an additional 1,000 shares of stock using a Dutch auction. The bids received are as follows: (Table below should be interpreted as follows: B…

1. Sydney Air services is now in the final year of a project. The equipment orig

1. Sydney Air services is now in the final year of a project. The equipment originally cost $15 of which $12 has been depreciated. Sydney can sell the used equipment today for $5 …

1. Synergy is said to take place when the merged companies are greater than the

1. Synergy is said to take place when the merged companies are greater than the individual companies working separately. (True or False) 2.The potential of a tax loss carryforward…

1. Synyster Corp. has an ROE of 14 percent and a payout ratio of 22 percent. Wha

1. Synyster Corp. has an ROE of 14 percent and a payout ratio of 22 percent. What is its sustainable growth rate? (Do not round intermediate calculations and enter your answer as …

1. S˜ao Paolo Foods is a Brazilian producer of breads and other baked goods. Ove

1. S˜ao Paolo Foods is a Brazilian producer of breads and other baked goods. Over the past year, protability has been strong and the share price has risen from R$15 per share to R…

1. T or F: Homebuilding companies, like D.R. Horton Inc., realized significant l

1. T or F: Homebuilding companies, like D.R. Horton Inc., realized significant losses in 2008-2009, but have realized gains since then. 2. T or F: A bond can only be easily refund…

1. TRUE OR FALSE A 100% stock dividend results in a doubling of the number of ou

1. TRUE OR FALSE A 100% stock dividend results in a doubling of the number of outstanding shares, but it does not affect the company's assets, profits, or total value. 2. Which on…

1. TXC Energy Distributors, a natural gas and gas products company, is analyzing

1. TXC Energy Distributors, a natural gas and gas products company, is analyzing a gas purchase project. The projections were provided by a field engineer, and the project is expe…

1. Take a loan 250,000 interest rate is 5% APR but compounded and paid monthly.

1. Take a loan 250,000 interest rate is 5% APR but compounded and paid monthly. Take a 30 year mortgage. What is your monthly payment? 2. Currently owe $100,000 on your home. Mort…

1. Tammy Monahan is considering the purchase of a home entertainment center. The

1.   Tammy Monahan is considering the purchase of a home entertainment center. The product attributes and weights she plans to consider are: portability             .1 sound proje…

1. Tarheel Furniture Company is planning to establish a wholly owned subsidiary

1. Tarheel Furniture Company is planning to establish a wholly owned subsidiary to manufacture upholstery fabrics. Tarheel expects to earn $1 million after tax on the venture duri…

1. Tawanna is considering starting a small business. She plans to purchase equip

1. Tawanna is considering starting a small business. She plans to purchase equipment costing $149,000. Rent on the building used by the business will be $26,000 per year while oth…

1. Tax deductibility is a characteristic of: Debt Equity 2. EPS dilution is a ch

1. Tax deductibility is a characteristic of: Debt Equity 2. EPS dilution is a characteristic of: Debt Equity 3. Debt cost is: Low High 4. Increased risk is a characteristic of: De…

1. Techfin Consulting, a profitable company, has yet to pay dividends. However,

1. Techfin Consulting, a profitable company, has yet to pay dividends. However, its board has indicated to initiate a $0.25 dividend in 4 years and increase by 30% each year for 2…

1. Teddy\'s Pillows has beginning net fixed assets of $458 and ending net fixed

1. Teddy's Pillows has beginning net fixed assets of $458 and ending net fixed assets of $524. Assets valued at $306 were sold during the year. Depreciation was $16. What is the a…

1. Teller Pen is engaged in the manufacture of mechanical pens and pencils, poro

1. Teller Pen is engaged in the manufacture of mechanical pens and pencils, porous pens, and a recently developed line of disposable lighters. Since the firm sells to a great many…

1. Temporary Housing Services Incorporated (THSI) is considering a project that

1. Temporary Housing Services Incorporated (THSI) is considering a project that involves setting up a temporary housing facility in an area recently damaged by a hurricane. THSI w…

1. Ten years ago Heather borrowed $400,000 to buy a house. She has a 30 year, 4.

1. Ten years ago Heather borrowed $400,000 to buy a house. She has a 30 year, 4.50% fixed rate mortgage. She made the 120th payment today. Payments are made monthly. She now owes …

1. Ten years ago, Raine Corporation earned $0.50 per share. Its earnings this ye

1.                  Ten years ago, Raine Corporation earned $0.50 per share. Its earnings this year were $2.20. What was the growth rate in earnings per share (EPS) over the 10-ye…

1. Terry Malloy is trying to decide whether his shipping company should invest i

1. Terry Malloy is trying to decide whether his shipping company should invest in a new boat. The new boat will cost $200,000 and it will be fully-depreciated on a straight-line b…

1. Tex-House builds and sells houses for $200,000 each. The firms fixed costs ar

1. Tex-House builds and sells houses for $200,000 each. The firms fixed costs are $3,000,000. 50 houses are built and sold each year. Profits total about $2,000,000. The firm esti…

1. The $86.77 amount located in the bank statement column should not be there. W

1. The $86.77 amount located in the bank statement column should not be there. What accounts should be debited and credited so that the general ledger and bank statement still bal…

1. The 1-year interest rate in the U.S. is 10%; in Switzerland it is 12%. The cu

1. The 1-year interest rate in the U.S. is 10%; in Switzerland it is 12%. The current spot rate (dollars per franc) is $0.40. a.         What do you expect the 1-year forward rate…

1. The 11/11/2013 nominal interest rate on ten year US government bonds is 2.75%

1.     The 11/11/2013 nominal interest rate on ten year US government bonds is 2.75% (source: Yahoo Finance) and inflation (consumer price index, all urban consumers, US city aver…

1. The 2013 balance sheet of Bear Inc., showed long-term debt of $1.45 million,

1. The 2013 balance sheet of Bear Inc., showed long-term debt of $1.45 million, and the 2014 balance sheet showed long-term debt of $1.52 million. The 2014 income statement showed…

1. The 2017 balance sheet of Dream, Inc., showed current assets of $4,545 and cu

1. The 2017 balance sheet of Dream, Inc., showed current assets of $4,545 and current liabilities of $2,825. The 2018 balance sheet showed current assets of $3,280 and current lia…

1. The 2017 balance sheet of Kerber’s Tennis Shop, Inc., showed $500,000 in the

1. The 2017 balance sheet of Kerber’s Tennis Shop, Inc., showed $500,000 in the common stock account and $3.3 million in the additional paid-in surplus account. The 2018 balance s…

1. The 5-year project requires equipment that costs $100,000. If undertaken, the

1. The 5-year project requires equipment that costs $100,000. If undertaken, the shareholders will contribute $20,000 cash and borrow $80,000 at 6% with an interest-only loan with…

1. The Baby Steps can best be described as: O A systematic process for getting o

1. The Baby Steps can best be described as: O A systematic process for getting out of a financial mess and into building wealth O A series of seven sequential steps that help you …

1. The Baldwin company will increase its automation for the Bold product by 2.0.

1. The Baldwin company will increase its automation for the Bold product by 2.0. Assuming no further change in capacity, how much will this investment in automation cost? Select: …

1. The Bank of America faces a investor who would like to borrow $10,000 for a p

1. The Bank of America faces a investor who would like to borrow $10,000 for a project. If this is a good project, it has 4/5 chance of being succeed which lead to a return of $20…

1. The Bell Weather Co. is a new firm in a rapidly growing industry. The company

1. The Bell Weather Co. is a new firm in a rapidly growing industry. The company is planning on increasing its annual dividend by 20% a year for the next four years and then decre…

1. The Bet-r-Bilt Company has a 5-year bond outstanding with a 4.00 percent coup

1. The Bet-r-Bilt Company has a 5-year bond outstanding with a 4.00 percent coupon. Interest payments are paid semi-annually. The face amount of the bond is $1,000. This bond is c…

1. The Burn Inc. is evaluating building a new widget factory and financing the p

1. The Burn Inc. is evaluating building a new widget factory and financing the project entirely with retained earnings. The minimum rate of return the firm requires on this invest…

1. The CFO of Vaimato Industries needs to borrow money (a one-year loan) in the

1. The CFO of Vaimato Industries needs to borrow money (a one-year loan) in the coming months to support the start up of a new project. The interest rate in the U.S. for a dollar …

1. The Chung Chemical Corporation is considering the purchase of a chemical anal

1. The Chung Chemical Corporation is considering the purchase of a chemical analysis machine. Although the machine being considered will result in an increase in earnings before i…

1. The City of Ft. Myers is considering three mutually exclusive designs for enh

1. The City of Ft. Myers is considering three mutually exclusive designs for enhancing the capacity of a canal to reduce flooding. The interest rate is 6% and the project is desig…

1. The Cougar Corporation has issued 20-year semi-annual coupon bonds with a fac

1. The Cougar Corporation has issued 20-year semi-annual coupon bonds with a face value of $1,000. If the annual coupon rate is 10% and the current yield to?maturity is 12%, what …

1. The DRK Corporation recently developed a dividend reinvestment plan (DRIP). T

1. The DRK Corporation recently developed a dividend reinvestment plan (DRIP). The plan allows investors to reinvest cash dividends automatically in DRK in exchange for new shares…

1. The December 31, 2009, balance sheet of Schism, Inc., showed long-term debt o

1. The December 31, 2009, balance sheet of Schism, Inc., showed long-term debt of $1.395 million, and the December 31, 2010, balance sheet showed long-term debt of $1.57 million. …

1. The Dog House expects sales of $560, $650, $670, and $610 for the months of M

1. The Dog House expects sales of $560, $650, $670, and $610 for the months of May through August, respectively. The firm collects 20 percent of sales in the month of sale, 70 per…

1. The Dullpore Corp. instituted a just-in-time inventory program so that the am

1. The Dullpore Corp. instituted a just-in-time inventory program so that the amount of inventory that they hold at any one time is greatly reduced. Did Dullpore decrease or incre…

1. The European put option on Summer.com with an exercise price of $50 expiring

1. The European put option on Summer.com with an exercise price of $50 expiring a year from now isselling for $10.60, and the risk free rate is 4%. Suppose that you would like to …

1. The Falling Snow Company is considering production of a lighted world globe t

1. The Falling Snow Company is considering production of a lighted world globe that the company would price at a markup of 0.25 above full cost. Management estimates that the vari…

1. The Fed- Briefly describe the origin of the Federal Reserve System. Describe

1.  The Fed- Briefly describe the origin of the Federal Reserve System. Describe the functions of the Fed district banks.<?xml:namespace prefix = o ns = "urn:schemas-microsoft-…

1. The Federal Reserve purchases $1,000,000 of foreign assets for $1,000,000. Sh

1. The Federal Reserve purchases $1,000,000 of foreign assets for $1,000,000. Show the effect of this open market operation using T-accounts. 2. Again, the Federal Reserve purchas…

1. The Federal Reserve purchases $1,000,000 of foreign assets for $1,000,000. Sh

1. The Federal Reserve purchases $1,000,000 of foreign assets for $1,000,000. Show the effect of this open market operation using T-accounts. 2. Again, the Federal Reserve purchas…