Finance question and answers for October 10, 2023
- Q Discuss the pros and cons of a MNC having a centralized cashmanager handle all investment and borrowing for all affiliates ofthe MNC versus each affiliate having a local manager who...
- Q Your factory has been offered a contract to produce a part for anew printer. The contract would last for 3 years and your cashflows from the contract would be $...
- Q AdventureParks Ltd is evaluating the construction of a new themepark. The theme park would cost $ 495 ?million, but would operatefor 20 years. AdvertureParks expects annual cash flows fromoperating the...
- Q ?(Bond valuation?) You are examining three bonds with a parvalue of $1,000 ?(you receive $1,000 at? maturity) and areconcerned with what would happen to their market value if interestrates? (or...
- Q A stock is currently trading for $38. The company has aprice–earnings multiple of 10. There are 100 million sharesoutstanding. Your model indicates that the stock is actually worth$28. The company...
- Q Chantel Cohen works for ABC retailers and is seeking managementsapproval to install an automatic mail-response system. using thecorrect proposal format, write Jamie Oliver, Chantels managerrequesting a decision to be made...
- Q show Excel ( show all work including formulars)As a senior analyst for the company you have been asked toevaluate a new IT software project. The company has just paid aconsulting...
- Q Your brother has offered to give you $ 165?, starting next?year, and after that growing at 2.8 % per year for the next 20years. You would like to calculate the...
- Q Compare and contrast the three basic types of taxation thatgovernments levy within their tax jurisdictions.
- Q Use the table below to answer the following questions: PresentValue of 1 Factor Present Value of an Annuity of 1 Factor Period1/2 Yr Full-Yr 1/2 Yr Full-Yr 1 0.9578 0.9174...
- Q Describe using appropriate examples the ubiquitous natureofinformation technology.
- Q FastTrack? Bikes, Inc. is thinking of developing a new compositeroad bike. The development will take six years and the cost is $188000 per year. Once in? production, the bike is...
- Q top managers of Preston Preston Industries predicted 2014 2014sales of 14 comma 400 14,400 units of its product at a unit priceof $ 8.50 $8.50. Actual sales for the year...
- Q P/E Ratio is 75.40 and Beta is 1.62 Amazon iscompany1. compare the P/E ratio of your company with the industryaverage or with a major competitor. How does your chosen companycompare...
- Q You are a business consultant. You have just taken on anew client for Enterprises Pty Ltd, a manufacturer ofcakes. Your client has just begun the process of settingup this business....
- Q (Bond valuation?) You own a 20?-year, $1,000 par value bondpaying 8 percent interest annually. The market price of the bond is?$850 and your required rate of return is 11 percent.a....
- Q A 35-year loan is to be repaid by half-yearly repayments of1,000 starting in 6 months at an interest rate of 9.0% p.a.compounded half yearly. Or, it can be repaid by...
- Q how do you get free cash flow from the income and balance sheetplease explain it step by step.
- Q Calculate the future value of $ 9,000 ina. 5 years at an interest rate of 5 % per year.b. 10 years at an interest rate of 5 % per year.c....
- Q Consider an option on a non-dividend paying stock when the stockprice is $67, the exercise price is $61, the risk-free rate is0.5%, the market volatility is 30% and the time...
- Q do firms have any responsibilities to society atlarge
- Q Let Ti, i=1, … ,n be a set of dates, on which payments of thefloating leg of an interestrate swap occur. The payoff of the floating leg of the swap...
- Q Permian Partners (PP) produces from aging oil fields in westTexas. Production is 1.97 million barrels per year in 2016, butproduction is declining at 9% per year for the foreseeable future.Costs...
- Q typing one page about international equity and bond market.
- Q Please give us one example from your research, work, or personallife of an application whilw Describing what concepts of FinancialEconomics and the contexts within which it is practiced. Describethe elements...
- Q You are about to ask the bank for a loan for $ 5,000 at acompound annual interest rate of 9% with a monthly capitalization.You are asked to make five semiannual...
- Q A government bond matures in 7 years, makes annual couponpayments of 5.1% and offers a yield of 3.1% annually compounded.Assume face value is $1,000. (Do not round intermediatecalculations. Enter your...
- Q You have an opportunity to invest $103,000 now in return for$80,200 in one year and $29,300 in two years. If your cost ofcapital is 8.9%?, what is the NPV of...
- Q You are looking to finance your home. The bank is offering athree-year ARM (adjustable-rate mortgage) with an introductory rateof 3.60%. It has a 3.00% adjustment cap per adjustment period, alifetime...
- Q Is it ethical for tobacco companies to sell a product that isknown to be addictive and a danger to the health of the user? Is itrelevant that the product is...
- Q (a) James is applying for a new home loan. He wishes to borrow$250,000 and make his repayments monthly. The interest rate thebank has quoted him is 4% per annum. 1....
- Q A hedge fund manager shorted 800 shares of XYZ stock at$65/share and she plans to close out her short position in ninemonths. She decides to put options to fully hedge...
- Q Your company (US-based organization) is expected to receive 4million British pounds in nine months. You decide to use Europeancall options to fully hedge against your currency risk. Each calloption has...
- Q You have to buy a new copier. The cost of the copier is $2,000?,plus $ 400 per year in maintenance costs. The copier will last forfive years. Alternatively a local...
- Q Suppose that as a financial manager you have collected thefollowing information on your company.Before-tax cost of debt6.5%Tax rate40%Total long term debt$400,000Cost of preferred stock7.25%Total preferred stock$50,000Cost of common stock11%Total common...
- Q If you were the CEO of a company, what would you do to yourcompensation and benefits plan to make it effective in aligningemployee behavior and performance with the needs of...
- Q X-Ray Inc. stock currently sells for $49, but you believe itsprice will decline over the next six months. You decide to use 10six-month European put options to speculate on your...
- Q 1. (complete chart) Bank of America sells a 12 year fixed ratebond at 6%. At the same time of the issue the company buys areceiver swaption, 6% and paying variable...
- Q What are the three types of financial management decisions andwhat questions are they designed to answer? • What are the threemajor forms of business organization? • What is the goal...
- Q (c) You have commenced work as a Certified Financial Planner.Your supervisor has provided the following financial data for a newclient Brant Jerome. The client turned 34 years old today and...
- Q Part 1 IT Software Project As a senior analyst for the company you havebeen asked to evaluate a new IT software project. The company hasjust paid a consulting firm $50,000...
- Q Suppose that you deposit $391 in a savings account at ProsperityBank at the end of each of the next 10 months. You plan to leavethese contributions and any interest earned...
- Q Competing in the marketplace on the basis of a competitiveadvantage:a) involves either giving buyers what they perceive as superiorvalue compared to the offerings of rival sellers or giving buyersthe same...
- Q Your company is considering a recapitalization plan that wouldconvert it from its current all-equity capital structure to oneincluding financial leverage. Your company now has 10000,000 sharesof ordinary shares outstanding, which...
- Q A machine cost $30,000 initially and has no salvage value. TheO&M costs in year 1 were $10,000 and have been increasing by$2,000 from year 2. The minimum cost life of...
- Q Anicex Co. is growing quickly. Dividends are expected to grow ata rate of 20 percent for the next three years, with the growth ratefalling off to a constant 5 percent...
- Q (b) You have been offered the opportunity to purchase a start upcompany building electric cars for the Australian market calledGreen Motors P/L. Your initial investment is $22,000,000. The termof the...
- Q 1. (a) Suppose Carter Chemical Company'smanagement conducts a study and concludes that if Carter expandsits consumer products division (which is less risky than itsprimary business, industrial chemicals), the firm's beta...
- Q Payback, NPV, and MIRRYour division is considering two investment projects, each ofwhich requires an up-front expenditure of $23 million. You estimatethat the cost of capital is 9% and that the...
- Q Go fly a kite is considering making and selling custom kites intwo sizes. The small kites would be priced at $11.60 and the largekites would be $24.60. The variable cost...
- Q A stock trades for?$46per share. A call option on that stock has a strike price of?$54and an expiration datethreemonths in the future. The volatility of the? stock's returnsis37%and the? risk-free...
- Q In a manufacturing process the assembly line speed (feet perminute)was thought to affect the number of defective parts foundduring the inspection process. To test this theory, managersdevised a situation in...
- Q You are an industry analyst that specializes in an industrywhere the market inverse demand is P = 200 - 2Q. The externalmarginal cost of producing the product is MCExternal =...
- Q Suppose that the prices of zero-coupon bonds with variousmaturities are given in the following table. The face value of eachbond is $1,000.Maturity (Years)Price1$925.932853.393782.924715.005650.00a. Calculate the forward rate of interest foreach...
- Q Give examples of five (unique) instances when you will need(demand) a currency other than the US dollar. Does this demand forthe other currency automatically mean supply of dollars?Explain.
- Q How much of the third mortgage payment will go to pay down theprinciple?Home Price: $339,000 USD15% down payment of selling price25 year term loan with a 3% annual interest rate
- Q A newly issued bond has a maturity of 10 years and pays a 7%coupon rate (with coupon payments coming once annually). The bondsells at par value.a. What are the convexity...
- Q A stock trades for?$46per share. A call option on that stock has a strike price of?$54and an expiration datethreethreemonths in the future. The volatility of the? stock's returnsis37?%,and the? risk-free...
- Q The Deluxe Corporation has just signed a 144-month lease on anasset with a 17-year life. The minimum lease payments are $2,200per month ($26,400 per year) and are to be discounted...
- Q Assume that the price of real estate is determined byP=PV(all cash flows generated by the real estate).After you have graduated you work for some years and can savesome money. You...
- Q You are serving on a jury. A plaintiff is suing the city forinjuries sustained after a freak street-sweeper accident. In thetrial, doctors testified that it will be five years before...
- Q Glenn has made contributions of? $250 at the end of every threemonths into an RRSP for 10 years. Interest for the first 10 yearswas? 4% compounded quarterly.?(a) What is the...
- Q You would like to buy a house that costs $350,000. You have$50,000 in cash that you can put down on the house, but you need toborrow the rest of the...
- Q ?A(n) 10.0?%, 25-year bond has a par value of? $1,000 and a callprice of $1,125. (The bond's first call date is in 5? years.)Coupon payments are made semiannually? (so use...
- Q Firm XYZ has 2.5 million outstanding stocks, each selling for$14 per share. The firm’s debt is publicly trading at 85 percent ofits $7.5 million face value. The firm pays a...
- Q Man with $59,000 AGI, he contributed $5,500 to his traditionalIRA. No distributions taken. What is their savers credit?
- Q ??After a careful evaluation of investment alternatives and?opportunities, Masters School Supplies has developed a? CAPM-typerelationship linking a risk index to the required return? (RADR),as shown in the tableLOADING....The firm is...
- Q You are evaluating a project that will cost $ 527,000?, but isexpected to produce cash flows of $ 125 comma 000 per year for 10?years, with the first cash flow...
- Q Explain what it means to “beat the market.” Why do manyindividuals -- both academic and nonacademic -- believe that suchis not systematically possible? What may move you to temper thisview?...
- Q WACC AND COST OF COMMON EQUITYKahn Inc. has a target capital structure of 60% common equityand 40% debt to fund its $9 billion in operating assets.Furthermore, Kahn Inc. has a...
- Q PMT =(PV)i1 ? (1 +i)?n.A loan of $250,000 is amortized over 30 years with payments atthe end of each month and an interest rate of 6.3%, compoundedmonthly.Use Excel to create...
- Q merger and acquisitionFirm Z has a current market value of $35 million and isconsidering the acquisition of firm Y, whose current market valueis $20 million. Both firms are all-equity. A...
- Q The Campbell Company is considering adding a robotic paintsprayer to its production line. The sprayer's base price is$800,000, and it would cost another $16,500 to install it. Themachine falls into...
- Q You have just purchased a share of stock for $ 21.03, Thecompany is expectedto pay a dividend of $ 0.65 per share in exactly one year.If you want to earn...
- Q The Wrigley Corporation needs to raise $17 million. Theinvestment banking firm of Tinkers, Evers & Chance will handlethe transaction.a. If stock is utilized, 1,700,000 shares will besold to the public...
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