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Get college assignment help at uniessay writers The equilibrium interest rate O equates the aggregate demand for funds with the aggregate supply of loanable funds O equates the elasticity of the aggregate demand and supply for loanalble funds decreases as the aggregate supply of loanable funds decreases O increases as the aggregate demand for loanable funds decreases
3) Suppose you have the following information aborut three companies, Which of the companies has a better liquidity position? Calculate the liquidity ratios and comment Jabir Airlines $1000 $250 Air Corner Past Air Cash $1000 $2000 $1000 $300 Acc. Receivables Inventories $1000 $50 $1750 $300 Acc. Payable $100 $120
it Net Inoome of Hamid nc. in 20ns is 57sa.ooo- DFill i tee spaces labeled X abeve (Calculate Lone total liabilities and oquity b Calculate total asset turmover an inoemtory tnocer atios for 2813 How efficiently is the company managing its assets to generate sales? c) Calculate profit margin, return on assets, and retum on equity ratios for 2018: How well has the company performed overal?
suonsanh NIS 1 Orange Electronies Inc. has a profitability ratio of 0.14, an asset turnover Fatio of 1.7 a debt to equity ratio of 0.60, and a debt ratio of 0.80. What is the firm’s ROE?
Problem 1 Using the example for the hardware store in the book “Unde standing Finance Statements” on page 9, please prepare a balance sheet for the end of week 2, 3, 4,
“There is an intrinsic link between policy, power, and politics in an organization. How are these linked? Describe an experience that relates to politics within an organization. Perhaps you know of promotions that were given to unqualified or not the best qualified candidates because of politics. What have you experienced and how did you react? How did policies and power influence the political actions?
Question A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.5%. The probability distributions of the risky funds are: Expected Return|Standard Deviation Stock fund (S) 15% 32% Bond fund (B) 23 9 The correlation between the fund returns is .15. Tabulate and draw the investment opportunity set of the two risky funds. Use investment proportions for the stock fund of 0% to 100% in increments of 20%. What expected return and standard deviation does your graph show for the minimum-variance portfolio?
Instructions Please read the following scenario, complete the required task, and discuss the questions below. Martin and Samantha need your help again to determine the best course of action for their company. YourName Corporation has decided to offer an employee 401(k) retirement plan. This plan will consist of the following mutual fund investment choices Money Market mutual fund AAA rated Corporate bond fund US Government Treasury Bond fund A Corporate Junk bond fund A “Blue Chip” stock fund An emerging market stock fund Martin feels that he is a conservative investor, while Samantha considers herself to be an above-average risk investor Please help them understand which investment choice would best match with their personal tolerance for risk. Task Consider your own tolerance for risk. Are you conservative, or aggressive in your investment philosophy? Here is a link to a Risk Tolerance Calculator that will help you determine the type of investment and strategy that is right for you. Discussion Questions Discussion Questions Please discuss the following questions in your initial post What are the results of your Risk Tolerance Questionnaire? What type of investor are you? Be sure to explain what this designation means, and if you feel that your score accurately reflects your personality regarding investing. Your choices are: oMoney Market mutual fund AAA rated Corporate bond US Government Treasury Bond A Corporate Junk bond o A “Blue Chip” stock An emerging market stock With this investment philosophy in mind, select one investment from the list above that you feel is the best match for your philosophy. Please explain why you feel this is the best match Identify an investment that would best suit Samantha’s and Martin’s level of risk Contrast your investment risk tolerance level with Martin and Samantha What is different about the investment that you advise for each of them?
Treasury notes and bonds, Use the infomation in the following table Today is February 15, 2008 Price (per $100 par value) Issue Coupon Rate Maturity Current Type YIM Rating Date Yiokd Date AA Bond Aug 2004 3477% 86 29 3.00% 8-15-2014 Ansume a $100 000 par value What in the yield to maturity of the August 2004 Treasury bond with semiannual payment? Compare the yield to mahurity and the current yleld How do you explain this relationship?
Problem 13-27: Purchase of a Newer Machine and Net Present Value Analysis. ACRS Depreciation. (CMA adapted) The WRL Company makes cookies for its chain of snack food stores. On January 2, 19X2 WRL Company purchased a special cookie cutting machine; this machine has been utilized for three years. WRL Company is considering the purchase of a newer, more efficient machine. If purchased, the new machine would be acquired on January 2, 19X5. WRL Company expects to sell 300,000 dozen cookies in each of the next four years. The selling price of the cookies is expected to average $.50 per dozen WRL Company has two options: (1) continue to operate the old mach ine, or (2) sell the old machine and purchase the new machine. No trade-in was offered by the seller of the new machine. The following informa- tion has been assembled to help decide which option is more desirable. New Machine Old Machine $120,000 $20,000 4 years $80,000 $10,000 7 years Original cost of machine at acquisition Salvage value at the end of useful life for depreciation purposes…. Useful life from date of acquisition Expected annual cash operating expenses: Variable cost per dozen…. Total fixed costs Depreciation method used for tax purposes: $.14 $14,000 $.20 $15,000 Straight- line STEMG HT Estimated cash value of machines: January 2, 19X5 …. December 31, 19X8… $120,000 20,000 $40,000 $7,000 The new machine is five-year property despite the fact that its estimated useful life is four years. WRL Company is subject to an overall income tax rate of 40 %. Assume that all operating revenues and expenses occur at the end of the year. Assume that any gain or loss on the sale of machinery is treated as an ordinary tax item and will affect the taxes paid by WRL Company at the end of the year in which it occurred. Required: Use the net present value method to determine whether WRL Company should retain the old machine or acquire the new machine. WRL requires an after-tax return of 16 percent. a. Without prejudice to your answer to Requirement a, assume that the quantitative differences are so slight between the two alternatives that WRL Company is indifferent to the two proposals. Identify and discuss the non-quantitative factors which are important to this decision that WRL Company should consider. Identify and discuss the advantages and disadvantages of using discounted cash flow techniques (e.g. the net present value method) for capital investment decisions. b. C.
Get college assignment help at uniessay writers 4. Vertical Relations (43 points) Suppose that a car dealer has a local monopoly in selling Volvo cars. It pays the wholesale price w to the monopolist Volvo for each car that it sells, and charges each consumer the retail price p. The demand function in the retail market is given by p-600-q. The marginal cost of Volvo is 200. A. (12 points) Suppose that the car dealer and Volvo work separately. What will be the Nash equilibrium? B. (6 points) Find the equilibrium profits for the dealer and Volvo. Find the equilibrium consumer surplus in this separation case. C. (5 points) Now suppose that Volvo bought the ownership of the car dealer. For the integrated firm, what will be the equilibrium quantity q and retail price p? What will be the total profit for the integrated firm? What will be the consumer surplus? D. (7 points) Provide detailed economic reasons why for both the consumers and the firms the integration case is better than the separation case? (Rather than compare the numbers, you have to show the economic reasons here.) E. (13 points) Retailers’ Competition El. (6 points) Now suppose that Volvo has two dealers who compete in the one-period Bertrand competition (short term) in the retail market. All the other conditions remain the same as before. Findthe new Nash equilibrium in this game. E2. (7 points) If these two dealers compete with each other in the long run, i.e.., an infinitely repeated Bertrand competition, with a discount rate of 0.8. All the other conditions remain the same as before. What is the new Nash equilibrium? (You don’t have to provide a rigorous answer in every step, and an intuitive explanantion will be fine)
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Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 6 % , and the market’s average return was 13%. Performance is measured using an index model regression on excess returns, Stock A 1 %1.2(rM -rf) Stock B 2 % 0.8(rM- N Index model regression estimates rf) R-square Residual standard deviation, o(e) Standard deviation of excess returns 0.588 e.442 10.5% 19.3% 21.8% 25.3% a. Calculate the following statistics for each stock: (Round your answers to 4 decimal places.) Stock A Stock B i. Alpha % % ii. Information ratio iSharpe ratio iv. Treynor measure b. Which stock is the best choice under the following circumstances? This is the only risky asset to be held by the investor. This stock will be mixed with the rest of the investor’s portfolio, currently composed solely of holdings in the ii market-index fund. ii. This is one of many stocks that the investor is analyzing to form an actively managed stock portfolio.
11 Assume that the firm is 40% financed by debt and 60% financed by equity. Its cost of debt is 8% and the cost of equity is 15%. The tax rate is 40%. What is the firm’s WACC? A. 8.75% B. 9.36% C. 10.92% D. 13.00% 12. The stock pays a dividend of $2 per year and its price is $80. Ifthe market return is 7% and the risk-free rate is 1%, what is the stock beta? A. 0.4 B. 0.25 С. 0.1. wers is correct D. None of the ans 13. Below is the selected information from the company’s financial statements. What is its cost of capital if the tax rate is 40 %? Market Value Cost Capital of (Million) Long-Term Debt 200 10% Common Stock 800 20% A. 11% B. 14% C. 17.2% D. 18.6% 14. The risk-free rate is 5% and the tangency portfolio has 20% expected return and 40% return standard deviation. A risk-loving investor has $1000 of wealth and she seeks to attain 27.5% expected return. How much money does she need to borrow from the bank? A. 500 B. 1000 C. 250 D. 1500 15. You have three millions to invest and there are three projects: Project Investment NPV A 1M 0.4M B 2M 0.25M C 3M 0.5M Which projects will you choose? A. A
1. An investment project delivers a cash flow of 30K per year for the first 7 years and then 10K forever. If the interest rate is 11%, what is the present value of the project’s cash flow? A. $205,376.12 B. $174,221.90 C. $164,113.45 D. $185,153.02 2. The investor is presented with the two following stocks and she chooses to invest 30% of her portfolio in stock A Stock A Stock B Expected Return 10% 15% Standard Deviation 20% 30% Which of the following statements is correct if the correlation between the stocks is -1? A. The expected return of the portfolio is 13.5%. B. The standard deviation of the portfolio is 15%. C. The standard deviation of the portfolio is 27 %. D. Both A and B are correct 3. The market portfolio expected return is 8% and its standard deviation is 16%. The risk-free rate is 1%. Assume that the CAPM holds. What is the standard deviation of the portfolio that invests 40% in the risk-free asset and 60% in the market? A. 8.1% B. 9.6% C. 10.5% D. 11.1% 4. The beta of company XYZ’s stock is 2. The annual risk-free rate is 2% and the market return is 9%. What is the expected return of the company’s stock? portfolio’s expected S A. 16% B. 20% C. 14% D. 17% 5. The stock ABC has a beta of 1.6 and its standard deviation is 30%. Its correlation coefficient with the market return is 0.8. What is the standard deviation of the market return? A. 18% B. 15% C. 20% D. None of the answers is correct 6. The stock beta is 2 and the correlation coefficient with the market return is 0.8. The standard deviation of the market return is 20 %. What is the standard deviation of the stock return? A. 40% B. 50% C. 60% D. None of the answers is correct. 7. The beta of company Myers’s stock is 2. The annual risk-free rate is 2 % and the annual market premium is 8%. What is the expected return for Myers stock? S A. 14% B. 18% C. 20% D. None of the answers is correct 8. You are considering is 1.5. The annual risk-free rate is 2% and the annual market premium is 8%. The expected annual profit from the software subscription is $100,000 and it is expected to grow at the rate of 6% per year. What is the maximum price you are willing to pay for the company? an investment in software company. The beta of software companies A. $908,153.55 B. S1,250,000.00 C. $1,370,925.78 D. $1,123,221.12 Project A has a NPV of $200K and an IRR of 30%. Project B has a NPV of $250K and an IRR of 20%. Both projects require statements is correct if you 9. investment of 100K. Which of the following an choose only one project? can A. Project A is preferred over Project B B. Project B is preferred over Project A C. Project A has a higher profitability index than Project B D. None of the statements above is correct. 10. The development manager is required to choose between two projects. Project A has an IRR of 25% and project B has an IRR of 30%. Which of the following statements is correct? A. If she can invest only in one B. If she can invest only in one project, the manager will choose project A C. If she can invest in both projects, the manager will choose both projects A and B project, the manager will choose project B D. None of the statements above is correct.
6. Cost of trade credit Aa Aa Firms usually offer their customers some form of trade credit. This allowance comes with certain terms of credit, C which will affect the actual cost of asset being sold for the buyer and the seller. Consider this case: Purple Turtle Group buys most of its raw materials from a single supplier. This supplier sells to Purple Turtle on terms of 1/15, net 45 The cost per period of the trade credit extended to Purple Turtle, rounded to two decimal places, is Purple Turtle’s trade credit has a nominal annual cost of , assuming a 365-day year. (Note: Round all intermediate calculations to four decimal places, and your final answer to two decimal places.) The effective annual rate (EAR) of the supplier’s trade credit is If Purple Turtle Group’s supplier shortens its discount period to five days, this will the cost of the trade credit
1. Calculate the number of shares issued through this IPO. 7 X Building an Income Statement Excel Sign In HOME INSERT FORMULAS PAGE LAYOUT DATA REVIEW VIEW Arial 12 A A Conditional Format as Cell Alignment Number Cells Editing A Formatting Table Styles Font Styles fox Hughes Technology Corp. recently went public with an initial public offering in X C D F A Hughes Technology Corp. recently went public with an initial public offering in which it received a total of $92.46 million in new capital funding. The underwriter used a firm commitment offering in which the offer price was $19.05 and the underwriter’s spread was |$1.40. Hughes also paid legal and other administrative costs of $2.85 million for the IPO Calculate the number of shares issued through this IPO. (Enter your answer in millions Round your answer to 2 decimal places.) New capital funding Offer price Underwriter’s spread 92,460,000 19.05 1.40 Other administrative costs 2,850,000 Complete the following analysis. Do not hard code values in your calculations, and do not round intermediate calculations. Number of shares issued
You have found the following historical information for the Daniela Company over the past four years: Year 4 $61.75 3.03 Year 1 Year 2 $59.32 Year 3 Stock price EPS $50.40 2.52 $68.54 2.64 2.89 Earnings are expected to grow at 15 percent for the next year. Using the company’s historical average PE as a benchmark, what is the target stock price one year from today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Target stock price
Question 1 3 p Those financial markets that facilitate the flow of short-term funds are known as money markets O capital markets O primary markets O secondary markets
If a security is undervalued, some investors would capitalize on this by purchasing that return for those . resulting in a security. As a result, the security’s price will investors. O rise; lower fall; higher O fall; lower O rise; higher
Businesses demand loanable funds to finance installment debt. O subsidize other companies. O invest in fixed and short-term assets. none of these
The post Question: The Equilibrium Interest Rate O Equates The Aggregate Demand For Funds With The Aggregate Supply Of Loanable Funds O Equates The Elasticity Of The Aggregate Demand And Supply For Loanalble Funds Decreases As The Aggregate Supply Of Loanable Funds Decreases O Increases As The Aggregate Demand For Loanable Funds Decreases appeared first on uniessay writers.
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