Accounting question and answers for November 27, 2023
- Q A project has an initial cost of $63,400, expected net cash inflows of $8,000 per year for 11 years, and a cost of capital of 14%. What is the project's...
- Q While computing covariances among the returns of several stocks can be complicated, the covariance of a stock's return with itself is always one.
- Q Kurtosis is a measure of Multiple Choice A. how fat the tails of a distribution are. B. the downside risk of a distribution. C. the normality...
- Q Relate information processing errors and behavioural biasness to Efficient Market Hypothesis and Technical Analysis in your own words. Explain in detail. (20 marks)
- Q What is the future value in 14 years of an ordinary annuity cash flow of $1,695 every quarter of a year at the end of a period, at an annual...
- Q Your uncle Adelai promises to pay you $16,000 in five years. You believe that you can earn a 6% rate of return on any investments made between now and then....
- Q When economic activity falls, earnings fall, after some time, dividends are cut (Re = D1/P0 + g). Consider how these changes might increase the required rate of return for firms....
- Q You are attempting to value a call option with an exercise price of $75 and one year to expiration. The underlying stock pays no dividends, its current price is $75,...
- Q Based on the following information, what is the Treynor index for the Human Fund? Human Fund Market Risk Free E(k) 10.0% 9.0% 2.0%...
- Q What is the quick ratio if cash is $10,000, accounts receivable are $25,000, inventories are $30,000, accounts payable are $40,000, and accrued payroll is $15,000? a. 0.73 b. 1.13 c....
- Q Do people always make rational decisions? What are the factors that lead to bounded rationality? What are the factors that lead to irrational economic decisions?
- Q The expected rate of return on a Treasury Bill is 0.036, the expected rate of return on the Wilshire 5000 is 0.11 and the required rate of return of a...
- Q Company XYZ is considering issuing 10-year corporate bonds. The face value is $1,000 and coupon rate is 5.5% paid semi-annually. If investors required return on similar corporate bonds...
- Q Consider term loans, lines of credit, and revolving lines of credit. Explain the characteristics of each. Suppose a firm wants to get credit to help facilitate its ongoing acquisition...
- Q A portfolio is composed of two stocks, A and B. Stock A has a standard deviation of return of 17%, while stock B has a standard...
- Q B&M currently has free cash flow of $24 million, which is expected to grow at a constant rate of 5%. B&Ms financial state-ments report short-term investments of $100 million, debt...
- Q QUESTION 1 A car will cost you $50,000 three years from now. You have deposited $8,000 @ 6% interest annually. Your aunt will pay for the rest. How much would...
- Q Two spot rates as follows, r1 r3 3% 4% Please find...
- Q 1. Union Local School District has a bond outstanding with a coupon rate of 3.6 percent paid semiannually and 17 years to maturity. The yield to maturity on this bond...
- Q Fully explain what you understand by the term Management By Objectives, and critically discuss at least five (5) of its features.
- Q On June 1, the 4-month interest rates in Switzerland and the United States were, respectively, 2% and 5% per annum with discrete compouding. The spot price of the Swiss franc...
- Q ABC MARKET VALUE = $52.85 CALLS PUTS STRIKE ...
- Q Assume you purchase (at par) one 15-year bond with a 6.75 percent coupon and a $1,000 face value. Suppose you are only able to reinvest the coupons at a rate...
- Q Your sister will start college in five years. She just informed your parents that she wants to go to Georgia Southern University. It will cost $20,000 per year for four...
- Q What is the expected return of he three stock portfolio described below? common stock Market Value Expected Return Ando Inc 95,000 12.0% Bee...
- Q The projected earnings before interest and taxes (EBIT) of ABC Company are $10,603. The company has 649 shares outstanding. The market value of debt is $18,630. The interest rate on...
- Q Firm B is planning an acquisition of Firm A. The stand-alone value of Firm A is $560 million, and synergies are estimated to be $85 million. What is the maximum...
- Q After Merrill Lynch analyst upgraded Coca-Cola stock on September 20, 2014, you bought on margin 5,000 shares at the price of $43.91 per share. The initial percentage margin is 60%...
- Q 1. Do you think business fight poverty? If not, as a business owner what would you do differently?
- Q What are the five stages of industry life cycles? Choose five industries that you believe represent each part of the cycle, and explain why each industry may fall under each...
- Q Illustrate the impact of substituting fixed for variable cost on the volatility of earnings.
- Q RM International wishes to sell $100 million of bonds whose net proceeds will be used in the acquisition of Little Brooks. The underwriter believes that the 100,000 bonds can be...
- Q Consider an annual coupon bond with 4% YTM, duration of 11.1 years, and a convexity of 121.65. The bond is currently priced at $800.10. If the interest rate were to...
- Q Compounding Interest and the Banker There are many factors influencing the cost of money for both individuals and corporations. Suppose you deposit money in an interest-bearing account and at the...
- Q Assume that you have met the clients described in the case study and completed your discovery process with them. Based on the information you collected, prepare the presentation that you...
- Q 11. Assume the current selling price of a firms stock is: $100. Using the Excel file Dividend Data, compute the firms cost of equity using the Gordon dividend model. ...
- Q Checking account $3000 Savings account $12000 Credit Card account $5000 Utility Bill $300 Home $310000 Mortgage (30 years) $200000 Car $20000 Car loan (60 months) $18000 Student loan (7 years)...
- Q As the credit manager of a local bank, you decided to give 10,000$ credit to your customer. The customer agreed to pay back this loan as 4 equal payments. If...
- Q An insurance company must make payments to a customer of $11 million in one year and $6 million in five years. The yield curve is flat at 6%. a. If...
- Q Below is a quote (with minor modification) from The Economist(October 6,2012 issue):The Reserve Bank of Australia cut nominal interest rates to 3.25% on October 2nd,and the Aussie dollars strength is...
- Q Project L costs $61,157.76, its expected cash inflows are $14,000 per year for 9 years, and its WACC is 12%. What is the project's IRR? Round your answer to two...
- Q Steven has an investment that earns 11% return on investment. If inflation is 3%, what is Stevens real rate of return? 8.62%. 6.54%. 9.88%. 7.77%.
- Q Yellow Iris Corp.'s net income last year was $261.48 million. The company has 42.02 million shares outstanding. What is the firm's EPS? Round the answer to two decimal places.
- Q GOODWEEK TIRES, INC. After extensive research and development, Goodweek Tires, Inc., has recently developed a new tire, the SuperTread, and must decide whether to make the investment necessary to produce...
- Q ...
- Q Stock ABC has a beta of 1.4 and the standard deviation of its returns is 30%. The market risk premium is 5% and the risk-free rate is 3%. 1. What...
- Q The Fairfield Company's last dividend was $2.00. Its dividend growth rate is expected to be constant at 15% for 2 years, after which dividends are expected to grow at a...
- Q Please use excel and show formulas: Primula Corporation decides to issue a 30-year corporate bond. The bond carries a coupon of 6%, which represents the underlying 30-Year Treasury Note...
- Q Fitzroy Ltd. is a firm with 30 million shares outstanding and a corporate tax rate of 30%? ...
- Q Debt Management Ratios Zoe's Dog Toys, Inc. reported a debt to equity ratio of .80 times at the end of 2008. If the firm's total assets at year-end were $50.3...
- Q Property passes through probate when held at death in all of the following forms except: a. sole ownership b. tenancy in common c. community property d. tenants by the entirety...
- Q Aliber's common stock is selling at $97 and a 1 month put option on the stock is $4. The exercise price is $100. The risk-free rate is 8% per year....
- Q Use the following information to calculate your companys expected return. State Probability Return Boom ...
- Q New math** Assume currently Net income of AJX Group is $20,000, Dividend paid $4000, Retained earning amount in current balance sheet is $16,000. Firm follows constant dividend ratio. Next year...
- Q Gregory deposited $24,000 into a fund at the beginning of every quarter for 10 years. He then stopped making deposits into the fund and allowed the investment to grow for...
- Q T/F Changes in depreciation expense do not affect operating income because depreciation is a non-cash expense.
- Q It is now the beginning of the year (year 0). Assume that, starting at the end of the year 3 (NOT next year), you will make deposits of $185 each...
- Q A good business experiment to determine if a change in packaging affects the sale of a product should do which of the following to produce a reliable result. Group...
- Q list and explain the purpose of the various steps in a company valuation 40 marks
- Q A bona fide seniority system is ____________. Group of answer choices typically banned by the EEOC carefully defined by the law permitted in most cases under EEOC even if it...
- Q Growth models like those used in ForecastX usually model situations well where a process grows Multiple Choice at a more or less constant rate. until reaching...
- Q Mark Weinstein has been working on an advanced technology in laser eye surgery. His technology will be available in the near term. He anticipates his first annual cash flow from...
- Q An investment promises the following cash flow stream: Year 0 Year 1 Year 2 Year 3 Year 4 Cashflow...
- Q A banker lends $10,000 and will receive annual payments for six years. The bank makes decisions based on a MARR rate of 4.0% (compounded annually). Which of the following is...
- Q A company wants to issue new 15-year bonds to raise capital. Currently, the company has 5% coupon bonds on the market that make semi-annual payments, have a 8% YTM, and...
- Q 35a) Snap, Crackle, Pop a national foods distributor - is seeking to estimate its WACC. As part of the process, youve been tasked to estimate the cost of their...
- Q iskiyou, Inc. has total current assets of $1,200,000; total current liabilities of $500,000; long-term assets of $800,000; and long-term debt of $600,000. How much is the firm's total equity? A)...
- Q A) You have been provided with the information below on a British American Tobacco plc futures contract. You have been provided with the current share price, risk-free rate, futures price...
- Q An oil-drilling company must choose between two mutually exclusive extraction projects, and each requires an initial outlay at t = 0 of $11.8 million. Under Plan A, all the oil...
- Q 1. As a business owner, what steps would take towards your employee to impose overall behavior?
- Q a company has a D/E ratio of 1.50, a cost of equity equal to 14% and a before- tax cost of debt of 8%. their tax rate is 40%. in...
- Q Work on Excel please. If you invest $2,000 in Fund A and $8,000 in Fund B, Calculate the following: Portfolios Expected Return Portfolios Standard...
- Q In 12 years, you hope to have $20,000 set aside. Starting today, you plan to make quarterly deposits to the bank. Interest is 7% per year. What payment do you...
- Q Project L costs $65,000, its expected cash inflows are $11,000 per year for 8 years, and its WACC is 9%. What is the project's MIRR? Round your answer to two...
- Q Falco Inc. financed the purchase of a machine with a loan at 3.31% compounded semi-annually. This loan will be settled by making payments of $8,500 at the end of every...
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