Finance question and answers for August 05, 2023
- Q Calculate the NPV at 9% and the IRR for the following projects:An initial outlay of $69,724 and an inflow of 15,000 followed byfour consecutive inflows of $17,000
- Q please explain the implement CPPI and TIPP strategy asclearly as possible.
- Q It is now December 31, 2015 (t = 0), and a jury just found infavor of a woman who sued the city for injuries sustained in aJanuary 2014 accident. She...
- Q Photochronograph Corporation (PC) manufactures time seriesphotographic equipment. It is currently at its target debt-equityratio of .8. It’s considering building a new $72 millionmanufacturing facility. This new plant is expected to...
- Q A bond with a coupon rate of 12.5% per year (payable semiannually) has a life of 7.5 years and a yield to maturity of 14%.What is the bond's current...
- Q A & B Corporation issued bonds for 10 years, with face valueof $10,000 and a 6% annual coupon rate. What is the current marketprice of the bond if the market...
- Q You have estimatedspot rates as follows:r1= 6.40%,r2= 6.80%,r3= 7.10%,r4= 7.30%,r5= 7.40%.a.What are the discount factors for each date (that is, the presentvalue of $1 paid in year t)? (Do not...
- Q Vandalay Industries is considering the purchase of a new machinefor the production of latex. Machine A costs $2,400,000 and willlast for 5 years. Variable costs are 33 percent of sales,...
- Q You have $93395 to invest in two stocks and the risk-freesecurity. Stock A has an expected return of 11.39 percent and StockB has an expected return of 9.25 percent. You...
- Q (?NPV, ?PI, and IRR calculations?) Fijisawa Inc. is consideringa major expansion of its product line and has estimated thefollowing cash flows associated with such an expansion. The initialoutlay would be...
- Q You accumulated a balance of $2,300 on your credit card thatcarries an interest rate of 17%. You can't afford to pay the $2,300all at once, but you can pay the...
- Q A British bank issues a $130 million, three-year Eurodollar CDat a fixed annual rate of 8 percent. The proceeds of the CD arelent to a British company for three years...
- Q Based solely on Corporate Finance, and using correctterminology, discuss why a decrease in the corporate tax rate couldlead to poorer projects being accepted by companies.( Please write a little more...
- Q Portfolio beta and weightsRafael is an analyst at a wealth management firm. One of hisclients holds a $7,500 portfolio that consists of four stocks. Theinvestment allocation in the portfolio along...
- Q Suppose you are going to receive $19,000 per year for 6 years. theappropriate interest rate is 11 percent.a. what is the present value of the payments if they are inthe...
- Q Aswe get ready to close out this module review and reflect on whatyou have learned in personal finance. Identify and discuss a topicor lesson that you feel you got the...
- Q Based on the following information forXYZ Corporation, answer the each question (calculate for year2018). Assume that price per share is $15.25 and number of sharesis 350.20172018Income StatementSales3,850Cost of goods sold2,150Expenses200Depreciation875EBITInterest250Taxable...
- Q One More Time Software has 9.0 percent coupon bonds on themarket with 7 years to maturity. The bonds make semiannual paymentsand currently sell for 113.0 percent of par.Required:(a)What is the...
- Q Portfolio beta and weightsRafael is an analyst at a wealth management firm. One of hisclients holds a $10,000 portfolio that consists of four stocks. Theinvestment allocation in the portfolio along...
- Q Make me a millionaire. Assume that you are a financial advisor.I have come to you because I want to develop a plan for retiringearly.I am currently 24 years old and...
- Q A bond with a coupon rate of 7.30% has a price that today equals$868.92. The $1000 face value bond pays coupon every 6 month, 30coupons remain, and a coupon was...
- Q A ten-year bond, with par value equals $1000, pays 10% annually.If similar bonds are currently yielding 6% annually, what is themarket value of this bond? Use semi-annual analysis. Please showall...
- Q The Nickelodeon Manufacturing Co. has a series of $1000 parvalue bonds outstanding. Each bond pays interest semi-annually andcarries an annual coupon rate of 7%. Some bonds are due in 3...
- Q Case 1: You apply for a 20-year, fixed-rate (APR 6.48%)monthly-payment-required mortgage loan for a house selling for$150,000 today. Your bank requires 22% initial down payment ofhouse value (to be paid...
- Q Consider historical data showing that the average annual rate ofreturn on the S&P 500 portfolio over the past 85 years hasaveraged roughly 8% more than the Treasury bill return and...
- Q 2. Which of the following statements is FALSE? a. A portion of afirm's investment in its accounts receivable and inventory istemporary and results from seasonal fluctuations in the firm'sbusiness or...
- Q Case 3: We find the data for a municipal bond issued by theIllinois state government. The bond’s “last trade date” (i.e.,settlement date) is June 05, 2019. The bond’s “maturity date”...
- Q Commonwealth Construction (CC) needs $2 million of assets to getstarted, and it expects to have a basic earning power ratio of 10%.CC will own no securities, so all of its...
- Q Myles Houck holds 700 shares of Lubbock Gas and Light. He boughtthe stock several years ago at 47.49, and the shares are nowtrading at $75.00 Myles is concerned that the...
- Q 1a The maintenance on a machine is expected to be $155 at theend of the first year, then increasing by $35 each year for thenext 7 years. What sum of...
- Q You own 1,000 shares of stock in Avondale Corporation.You will receive $3.115 per share cash dividend in one year. In twoyears, the company will pay a liquidating dividend of $57...
- Q Based solely on Corporate Finance, and using correctterminology, discuss why a decrease in the corporate tax rate couldlead to poorer projects being accepted by companies.( Please write a little more...
- Q Vandalay Industries is considering the purchase of a new machinefor the production of latex. Machine A costs $2,240,000 and willlast for 5 years. Variable costs are 37 percent of sales,...
- Q Setting Standards, Materials and Labour VariancesTom Belford and Tony Sorrentino own a small business devoted tokitchen and bath granite installations. Recently, buildingcontractors have insisted on up-front bid prices for a...
- Q To solve the bid price problem presented in the text, we set theproject NPV equal to zero and found the required price using thedefinition of OCF. Thus the bid price...
- Q You have been asked to assess the expected financial impact ofeach of the following proposals to improve the profitability ofcredit sales made by your company. Each proposal is independent ofthe...
- Q Larissa has been talking with the company’s directors about thefuture of East Coast Yachts. To this point, the company has usedoutside suppliers for various key components of the company’syachts, including...
- Q (Bond valuation)???Pybus, Inc. isconsidering issuing bonds that will mature in 21 years with anannual coupon rate of 8 percent. Their par value will be ?$1,000?,and the interest will be paid...
- Q On 2001/6/1, Peter borrowed $6000, agreeing to pay interest at1.7%/year compounded monthly. He paid $1200 on 2005/2/1, and $1500on 2007/8/1. What equal payments on 2011/6/01, and 2013/12/01 willbe needed to...
- Q List six pieces of legislation effecting theemployment of people and write notes(10 lines each) on any two ofthem
- Q Vanlu Construction needs a piece of equipment that costs $200.Vanlu can either lease the equipment or borrow $200 from a localbank and buy the equipment. If the equipment is leased,...
- Q Part a. Green Tree Corporation is paying a dividend of $4 today.It expects dividends to grow at 25 percent for the next three yearsand to stabilize at 10 percent per...
- Q Lisa Lasher buys 380 shares of stock on margin at $22 per share.If the margin requirement is 50 percent, how much must the stockrise for her to realize a 45-percent...
- Q If, in a regular review of the debtor ledger you identifyoutstanding monies, what action should you take? 100–120 words
- Q Budget Variances, Materials and LabourMahn Corporation produces high-quality leather belts. Thecompany uses a standard costing system and has set the followingstandards for materials and labour:Leather (4 strips @ $4.00)$16.00Direct labour...
- Q Assume that the economy has three types of people. 15% are fadfollowers, 75% are passive investors, and 10% are informed traders.The portfolio consisting of all informed traders has a beta...
- Q RON Ltd has the following capital structure components:Five million shares issued with a current market price of 7.Equity holders require a 9% return.$10 million face value of Corporate bonds outstanding....
- Q You want to buy a new sports car from Muscle Motors for $58,000.The contract is in the form of a 48-month annuity due at a 6.50percent APR.Required:What will your monthly...
- Q What is the net present value of a project that has an initialcash outflow of $-13,000, at time 0, and the following cash flowsfor years 1-4? The required return is...
- Q You observe the stock returns on two publicly-traded commercialbanks, Chase MadHattan (CMH) and Spitigroup (S). Their historicalreturns for the past three years are:CMH: -30%, -45%, 15%;S: -20%, -30%, 5%.Consider a...
- Q You have a $42,000 portfolio consisting of Intel, GE, and ConEdison. You put $22,400 in Intel, $8,800 in GE, and the rest in ConEdison. Intel, GE, and Con Edison have...
- Q Demonstrate how auditor ethics strengthen confidence andevaluation of financial documents to support investmentdecisions.
- Q 1.in which of the following situations would you prefer to begiving a loan ?a interest rate 4 inflation 1 %b interest rate 9 inflation 7%c interest rate 3 inflation 4%d...
- Q The assignment is to provide specific financial suggestions forhow to pay off student debt early using one or morebusiness decision-making techniques. Pleasespecific and provide specific actions. Thank you
- Q Differentiate:MergerAcquisitionDivestiturePlease give sample by citing local and foreign cases indetails.
- Q 14. What are some situations other than immediate financialdistress that lead firms to file for bankruptcy? Discuss thefinancial and ethical implications.
- Q At the beginning of the month, you owned $7,000 of News Corp,$5,000 of First Data, and $8,000 of Whirlpool. The monthly returnsfor News Corp, First Data, and Whirlpool were 8.70...
- Q Daily Enterprises is contemplating the acquisition of some newequipment. The purchase price is $35,000. The equipment has a4-year life. The company expects to sell the equipment at the endof year...
- Q Select the best answer. Based upon a comparison of Table1 (2011 figures) and Table 2(2017 figures), it is fair tosay______________.Table 1: Selected FinancialsDiscount Retailing Industry 2011($ in '000s except per...
- Q You borrow $26,500 to purchase a brand new car. The interestrate is 6%, and the dealer says that you can pick between a 4-yearor 6-year loan. How much more interest...
- Q "Investors and the Investment Process" Pleaserespond to the following:Determine two ways in which a top-down investment policy canhelp with one’s investment strategy. Provide two examples tosupport your response.Determine the importance...
- Q Burklin, Inc., has earnings of $18.5 million and is projected togrow at a constant rate of 5 percent forever because of thebenefits gained from the learning curve. Currently, all earningsare...
- Q National Business Machine Co. (NBM) has $5 million of extra cashafter taxes have been paid. NBM has two choices to make use of thiscash. One alternative is to invest the...
- Q Discuss?how the bond market reacts when the FederalReserve increases short term interest rates. How do short-termversus long-term bond prices react? How do Treasury bonds versuscorporate bonds behave?
- Q Reactive PowerGeneration has the following capital structure. Its corporate taxrate is 35%.What is the companysWACC? Do not round intermediate calculations. Enter your answer asa percent rounded to 2 decimal places.SecurityMarket...
- Q Companies that choose to venture out on capital projects canutilize current savings, equity, or debt as ways to raise theneeded amounts. Each has benefits and limitations which change aseconomic and...
- Q When will the court “reform” a contract?
- Q CAPITAL BUDGETING CRITERIAA firm with a 13% WACC is evaluating two projects for thisyear's capital budget. After-tax cash flows, includingdepreciation, are as follows:012345Project M-$12,000$4,000$4,000$4,000$4,000$4,000Project N-$36,000$11,200$11,200$11,200$11,200$11,200NPV for each project:Project M $ 2,068.93Project...
- Q Explain the “Incontestable Clause” and the interactionof that clause with the “Misstatement of Age Clause”.
- Q Describe and differentiate between the “GuaranteedInsurability Option” and the “Cost-of-Living Riders”.
- Q Kimberly is looking to buy a home in California. The most he canafford to pay in total is $2,000 per month. Yearly property taxeswill be about $3,600 (escrowed monthly) and...
- Q Assume that you manage a fund with an expected rate of return of9% and a standard deviation of 21%. The T-bill rate is 3%. Supposeyour client would like to split...
- Q The following performance metric utilizes unique or unsystematicriskSelect one:a. Sharpe ratiob. Treynor ratioc. Information ratiod. M2
- Q Exhibit 2Apex Climbing Gear has provided the followinginformation for the most recent year. EBIT was $596,850, taxes were$142,700, interest expense was $72,324, total assets are$1,835,200, gross profitwas $842,000, and total...
- Q The probability of selecting a company that has a return onassets above 15 percent is 32 percent. The probability of selectinga company that has a dividend payout ratio at or...
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