Financial literacy

1. You are paying into a mutual fund that earns 6% compound interest. If you are

1. You are paying into a mutual fund that earns 6% compound interest. If you are making an annual contribution of $10,000, how much will be in the funds in 20 years? 2. You want t…

1. You are planning to make monthly deposits of $130 into a retirement account t

1. You are planning to make monthly deposits of $130 into a retirement account that pays 10 percent interest compounded monthly. If your first deposit will be made one month from …

1. You are planning to save for retirement over the next 28 years. To do this, y

1. You are planning to save for retirement over the next 28 years. To do this, you will invest $7000 a year in a stock account and $3000 a year in a bond account. The return of th…

1. You are preparing a cash budget for A&M Inc. for the first quarter of 2012. Y

1. You are preparing a cash budget for A&M Inc. for the first quarter of 2012. You have summarized the following information. A&M Inc. Cash Budget Worksheet First Quarter,…

1. You are purchasing a bond with face value 1000 a coupon rate 12% paid semi an

1. You are purchasing a bond with face value 1000 a coupon rate 12% paid semi annually and a maturity of 15 years. Investors are seeing 10% yield to maturity. What must you pay fo…

1. You are scheduled to receive annual payments of $11,000 for each of the next

1. You are scheduled to receive annual payments of $11,000 for each of the next 22 years. Your discount rate is 8 percent. What is the difference in the present value if you recei…

1. You are scheduled to receive annual payments of $11,000 for each of the next

1. You are scheduled to receive annual payments of $11,000 for each of the next 22 years. Your discount rate is 8 percent. What is the difference in the present value if you recei…

1. You are the chief financial officer of Donnelly Industries. On multiple occas

1. You are the chief financial officer of Donnelly Industries. On multiple occasions, you have engaged in insider trading but have never been able to earn any abnormal returns. Wh…

1. You are the founder and CEO of “STYLE”, a women shoes, handbags and belts sta

1. You are the founder and CEO of “STYLE”, a women shoes, handbags and belts startup company. You design your own products and sell directly to retail over the internet. You opera…

1. You are the purchaser of a call option with $5 premium and $145 exercise pric

1. You are the purchaser of a call option with $5 premium and $145 exercise price. You bought this option when the stock price was $120. If the stock price now is $155, what is th…

1. You are thinking about investing in one of the following mutual funds, MassMu

1. You are thinking about investing in one of the following mutual funds, MassMutual and Vanguard. You have obtained the following information based on their performance over the …

1. You are trying to decide on the best way to clean up a pond that can be used

1. You are trying to decide on the best way to clean up a pond that can be used for recreation and are given two schedules of costs and benefits over the next ten years that area …

1. You are using a net present value profile to compare Project A and B, which a

1. You are using a net present value profile to compare Project A and B, which are mutually exclusive. Which one of the following statements correctly applies to the crossover poi…

1. You believe that three risk factors drive share market returns: unexpected ch

1. You believe that three risk factors drive share market returns: unexpected changes in oil prices, unexpected shift in GDP, and unexpected movement in the overall share market. …

1. You buy a put option on a stock for a premium of $1. The exercise price is $1

1. You buy a put option on a stock for a premium of $1. The exercise price is $10.00. What is the option’s profit or loss if just prior to expiration the stock price is $9.50? a. …

1. You buy a stock for $40 and simultaneously buy a put with a $40 strike price

1. You buy a stock for $40 and simultaneously buy a put with a $40 strike price and a $1.00 premium and write a call with a $40 strike price and a $1.00 premium. What is your per-…

1. You buy a stock for $40 and simultaneously buy a put with a $40 strike price

1. You buy a stock for $40 and simultaneously buy a put with a $40 strike price and a $1.00 premium and write a call with a $40 strike price and a $1.00 premium. What is your per-…

1. You buy a stock for $50 and simultaneously write a call with a strike price o

1. You buy a stock for $50 and simultaneously write a call with a strike price of $51 and a premium of $0.50 per share. If the stock price falls to $48 per share, what is your per…

1. You buy a stock for $50 and simultaneously write a call with a strike price o

1. You buy a stock for $50 and simultaneously write a call with a strike price of $51 and a premium of $0.50 per share. If the stock price falls to $48 per share, what is your per…

1. You buy an 8% annual coupon bond that has a 15 year maturity and a required r

1. You buy an 8% annual coupon bond that has a 15 year maturity and a required return of 12%. The par value is $1,000. You sell the bond five years later when the required return …

1. You currenly own a portfolio valued at $56,000 that has a beta of 1.25. You h

1. You currenly own a portfolio valued at $56,000 that has a beta of 1.25. You have another $10,000 to invest and would like to invest it in a manner such that the portfolio beta …

1. You decide to invest your entire $500 by purchasing the equities. After 1 mon

1. You decide to invest your entire $500 by purchasing the equities. After 1 month the stock price goes down to $85 and you liquidate liquidate your position? What is your profit?…

1. You decide to take advantage of the current online dating craze and start you

1. You decide to take advantage of the current online dating craze and start your own web site. You know that you have 250 people who will sign up immediately and, through a caref…

1. You deposit $1,000 into an account each year for 10 years with the first depo

1. You deposit $1,000 into an account each year for 10 years with the first deposit made next year.  Assuming an interest rate of 5%, the account will have a balance of $____ 10 y…

1. You expect Amalgamated Company will pay $40 million in dividends and repurcha

1. You expect Amalgamated Company will pay $40 million in dividends and repurchase $70 million of its stock over the next 12 months (Year 1). You expect dividends and share repurc…

1. You expect Amalgamated Company will pay $80 million in dividends and repurcha

1. You expect Amalgamated Company will pay $80 million in dividends and repurchase $70 million of its stock over the next 12 months (Year 1). You expect dividends and share repurc…

1. You expect to receive $3,000 in 3 years (i.e., end of year 3). Then you plan

1. You expect to receive $3,000 in 3 years (i.e., end of year 3). Then you plan to invest it earning 5% per year. SHOW ALL WORK using TVM buttons on the TI BAII Plus Calculator. W…

1. You forecast a company to have a ROE of 11%, a dividend payout ratio of 44%.

1. You forecast a company to have a ROE of 11%, a dividend payout ratio of 44%. Currently the company has a price of $30 and $7 earnings per share.   What is the company's PEG rat…

1. You graduated from USF and got a job at MetLife pension department. Your supe

1. You graduated from USF and got a job at MetLife pension department. Your supervisor needs your help with some of its liabilities and risk control. The pension fund has a seres …

1. You have $1,395 today, and want to double your money in 7 years. What interes

1. You have $1,395 today, and want to double your money in 7 years. What interest rate must you earn to achieve your goal? Enter rate in percents, accurate to two decimal places. …

1. You have $4m to invest and able to purchase a $4m apartment building entirely

1. You have $4m to invest and able to purchase a $4m apartment building entirely with cash.  You anticipate you can sell the building for $6mm next year and a lender has offered a…

1. You have a $1,000 portfolio, which is invested in stocks A and B plus a risk-

1. You have a $1,000 portfolio, which is invested in stocks A and B plus a risk-free asset. $400 is invested in stock A. Stock A has a beta of 1.3 and stock B has a beta of .7. Ho…

1. You have a $2 million portfolio consisting of a $100,000 investment in each o

1.  You have a $2 million portfolio consisting of a $100,000 investment in each of 20 different stocks. The portfolio has a beta of 1.20.  You are considering selling $100,000 wor…

1. You have a $54,000 portfolio consisting of Intel, GE, and Con Edison. You put

1. You have a $54,000 portfolio consisting of Intel, GE, and Con Edison. You put $21,600 in Intel, $13,600 in GE, and the rest in Con Edison. Intel, GE, and Con Edison have betas …

1. You have a bond with annual coupon payments of $30, the interest rate for com

1. You have a bond with annual coupon payments of $30, the interest rate for comparable bonds is 5%, and there is a maturity value of $150 in 4 years.What is the current price of …

1. You have a child that is 10 years old, and would like to start saving up for

1. You have a child that is 10 years old, and would like to start saving up for their college education. You would like be able to pay $35,000 each year for four years of college …

1. You have been asked to make a short presentation at your company’s annual cap

1.   You have been asked to make a short presentation at your company’s annual capital budget meeting to present an analysis of the strengths and weaknesses of the following capit…

1. You have been asked to make a short presentation at your company’s annual cap

1.   You have been asked to make a short presentation at your company’s annual capital budget meeting to present an analysis of the strengths and weaknesses of the following capit…

1. You have been assigned to a project to determine if a new investment should b

1. You have been assigned to a project to determine if a new investment should be made. Your company uses a capital structure of 30% debt and 70% equity. The debt pays 8.5% intere…

1. You have been following a stock for 3 months and the following is its past re

1. You have been following a stock for 3 months and the following is its past return Year 1: 8% Year 2: 16% Year 3: 7% What is the standard deviation of the stock based on the his…

1. You have been hired as a consultant for Pristine Urban-Tech Zither, Inc. (PUT

1. You have been hired as a consultant for Pristine Urban-Tech Zither, Inc. (PUTZ), manufacturers of fine zithers. The market for zithers is growing quickly. The company bought so…

1. You have been saving for a car over the last seven years and you plan to purc

1. You have been saving for a car over the last seven years and you plan to purchase the car at the end of the next three years. Given the following: a) You have been saving for t…

1. You have invested $5,000 in an investment with an expected return of 8 percen

1. You have invested $5,000 in an investment with an expected return of 8 percent and $15,000 in an investment with an expected return of 16 percent. What is your expected return …

1. You have purchased a call option contract on Smith & Smith common stock. The

1. You have purchased a call option contract on Smith & Smith common stock. The option contract is for 100 shares. The option has an exercise price of $43.00 and S & S’s s…

1. You have purchased a home computer with the latest technology for $3,290.00 (

1. You have purchased a home computer with the latest technology for $3,290.00 (including tax). The store is financing your purchase with a three year loan with monthly payments o…

1. You have seen a credit card advertisement stating that the annual percentage

1. You have seen a credit card advertisement stating that the annual percentage rate is 12 percent. If the credit card requires monthly payments, what is the effective annual rate…

1. You have summarized the Helpful Company financial statements as shown below:

1. You have summarized the Helpful Company financial statements as shown below: A.Use the balance sheet data to identify 2015 sources and uses of cash. B. Based on these financial…

1. You have won a contest that will pay you $10,000 a year at the end of each of

1. You have won a contest that will pay you $10,000 a year at the end of each of the next 5 years. Based on a discount rate of 8% per year, what is the annuity worth to you today?…

1. You hold a portifolio with the following securities: Security Percent of port

1. You hold a portifolio with the following securities: Security Percent of portfolio Beta Stock A 23% 1.50 Stock B 48% 1.32 Stock C 29% 1.87 Calculate the beta portfolio Round th…

1. You hold the positions in the table below. What is the beta of your portfolio

1. You hold the positions in the table below. What is the beta of your portfolio? (Do not round intermediate calculations and round your final answer to 2 decimal places.) If you …