3The firm's Operating Margin is

a.17.8%

b.21.8%

c.24.6%

d26.9%

4The firm's Gross Profit Margin is

a.32.0%

b.34.2%

c.36.4%

d38.6%

5The firm's Pre-taxable Income is

a.1,200,000

b.1,000,000

c.800,000

d500,000

ecannot be determined

6$8,000.00 deposited in an account earning 10.26%, for 8 years. Calculate the future value

a.16,925.35

b.17,535.27

c.17,475.67

d17,937.39

7$8,000.00 deposited in an account earning 10.26% (compounded semi-annually), for 8 years.

Calculate the future value

a.16,816.31

b.16,932.55

c.17,535.27

d17,812.16

e18,306.44

8$8,000.00 deposited in an account earning 10.26% (compounded monthly), for 8 years.

Calculate the future value

a.18,706.32

b.18,639.89

c.18,525.52

d18,115.22

9$7,500 deposited in an account earning 6.58%, for 10 years (compounded weekly).

Calculate the balance in ten years

a.14,113.38

b.14,308.25

c.14,404.86

d14,475.93

10$7,500 to be received seven (7) years from today, discounted at 5%. Calculate the present value

Calculate the balance in ten years

a.5,355.55

b.5,343.25

c.5,330.11

d5,325.36

11Frank will need $7,500 in seven years (7). How much should Frank deposit in an account today, earning

6%, compounded semi-annually. Calculate present or discounted value of $7,500

a.4,999.99

b.4,987.93

c.4,965.35

d4,958.38

12$5,000.00 deposited in an account earning 8.5%, for 10 years compounded monthly. Calculate the interest factor

a.2.5019

b.2.4259

c.2.2609

d2.2401

e2.33265

13$5,000.00 deposited in an account, every year for the next ten years, earning 8.5%, for 10 years.

Calculate the future value of an annuity

a.74,180.35

b.74,175.49

c.74,168.35

d74,162.22

e74,158.25

14Let's say Biagio deposits $15,550 dollars in a CD (Certificate of Deposit) at Star Bank.

The bank is offering to pay 6.75% interest for 5 years. What will be the balance in

Ken's account five years from today.

a.19,592.32

b.20,000.00

c.20,321.25

d21,556.08

15If a firm has a gross profit of $1,000,000, selling and administrative expenses of $500,000,

depreciation of $100,000, and interest expense of $200,000, calculate its operating profit

a.200,000

b.250,000

c.325,000

d400,000

16Ganley Ford offers to sell your company a new Lincoln Navigator at factory list price, (Hybrid

conversion kit included) and, of course, outstanding financing. The list price is

$54,325 . The special rate is 6.13%. Calculate monthly payments on this 5 year loan.

a.1053.54

b.1052.22Solve for Payment -Present Value of Annuity

c1,049.66Monthly compounding

d1,048.73

17Let's say Biagio deposits $15,550 dollars in a CD (Certificate of Deposit) at Star Bank.

The bank is offering to pay 5.25% interest for 5 years. What will be the balance in

Biagio's account five years from today. Compounded semi-annually.

a.19,591.22

b.20,000.00Solve for Future Value (with compounding)

c.20,149.40

d21,557.13

18The value of any asset is

a.the future value of all current cash flowsThis is called fundamental of Classical

b.what the highest bidder is willing to pay for itValuation - Applies to Stocks, Bonds and Capital Budgeting

c.the current market price

dthe discounted value of all expected cash flows

19Let's say Karrin opens up an account with Vanguard Investments in a stock-mutual fund. The

fund is attractive to her because it promises 7.62% return for the life of the account. Karrin plans

to deposit $7,000 dollars a year, beginning one year from today for the next twenty years.

What will be the balance in her account when she goes to withdraw in twenty years.

a.307,163.98

b.306,210.55Future Value of an Annuity (ordinary annuity)

c.305,323.31

d304,311.10

20Let's say Karrin opens up an account with Vanguard Investments in a stock-mutual fund. The

fund is attractive to her because it promises 7.26% return for the life of the account. Karrin plans

to deposit $7,000 dollars a year, beginning one year from today for the next twenty years.

What is the interest factor.

a.42.18

b.43.88Future Value of an Annuity (Solve for Interest Factor)

c.44.36Hint - Calculate what's in formula brackets

d45.37

21Lloyd is estimating the growth rate of family insurance premiums. A family premium was $895

in 2003. Ten years later in 2013, the same family insurance premium was $1,850. Calculate the

growth rate over this period.

a.4.44%

b.5.39%Solve for rate in a lump sum formula

c.6.25%r = ((FV/PV) raised to 1/n) - 1

d7.53%

22 An investment portfolio generated the following returns over the last 5 years

-12%

6%

9%

16%

28%

2016

2017

2018

2019

2020

23Calculate the portfolio's expected return for 2021 (arithmetic mean average)

a.15.00%

b.13.25%You can try this long-hand, or see your

c12.08%calculator's manual - or YouTube

d9.40%

24Calculate the sample standard deviation for the portfolio

a.14.66%

b.13.11%You can try this long-hand, or see your

c12.36%calculator's manual - or YouTube

d9.36%

A firm has net sales of $15,000,000, Cost of Goods Sold $3,000,000, Depreciation Expense

of $500,000, Selling and Administrative Expenses of $1,000,000, Interest Expense of $1,000,000,

and an average tax rate of 25%.

25The firm's Net Income is

a.5,476,325

b.5,625,325

c.6,435,205

d7,125,000

26The firm's Operating Margin is

a.70.0%

b.66.0%

c.62.5%

d58.1%

27A factory is expected to generate $3,000,000 per year every year for the next twelve years.

An interested investor uses a required rate (discount rate) of 11.25%. What is the intrinsic

value of the factory to this investor. (solve for present value of an annuity)

a.19,247,271.61

b.19,133,220.55Present Value of an Annuity

c.18,976,457.88

d18,865,311.09

28An investment offers a perpetual cash flow of $50,000 per year. The return you require is 9%.

What is the value of this investment (perpetuity)

a.222,222.22

b.333,333.33PerpetuityP = PMT/r

c.444,444.44

d555,555.55

29Company A borrows $5,000,000 from Bank C. The loan terms call for Company A to pay the loan

back over five (5) years. If Bank C lends the money to Company A for this five (5) year loan at 5%,

Calculate the annual payment

a.1,154,874.00

b.1,325,350.00Present Value of an Annuity

c.1,225,350.00Solve for Payment

d1,105,325.00

30Refer to the previous question. Calculate the annual paymentCompany A is expected to pay in

year three (3).

a.163,325.25

b.159,225.25Amortization Schedule

c.157,250.42

d152,252.25

31Which column most accurately reflects current market conditions (most recent)

ABCDE

3 Month Treasury Bill0.038%1.250%2.460%4.050%5.350%

DJIA - Dow Jones Industrial Average33,00034,00035,00036,00037,000

NASDAQ1500014000130001200011000

Crude Oil73.5572.2568.3534.3132.21

Dollar/Yen110.25112.35114.45116.65118.85

32The current ratio is classified as

a.a debt ratio

b.a utilization ratio

c.a liquidity ratio

da profitability ratio

33Let's say Biagio deposits $15,550 dollars in a CD (Certificate of Deposit) at Star Bank.

The bank is offering to pay 6.75% interest for 5 years. What will be the balance in

Ken's account five years from today.

a.19,592.32

b.20,000.00

c.20,321.25

d21,556.08

34Lets say you deposit $300 per month, every month for the next 10 years, beginning

at the end of this month. You'll invest in a high risk stock fund that will pay 7.25%

What will be your balance when you go to retire in 10 years.

a.66,210.00

b.64,450.00

c.57,310.25

d52,646.02

35$5,000.00 deposited in an account earning 9.35%, for 10 years, compounded daily. Calculate the future value.

a.12,562.10

b.12,575.36

c.12,598.98

d12,734.54

36A mortgage loan is taken out for the amount of $250,000. It is a conventional mortgage loan,

thirty years, monthly payments. Then mortgage interest rate in 5.10%. Calculate the monthly payment

a.1,128.19

b.1,143.25

c.1,194.49

d.1,357.37

37You will receive $5,000 per year, every year for the next five (5) years, beginning at the end of this year.

If you use 6% as your discount rate, calculate the present value of this annuity.

a.21,061.80

b.21,095.37

c.21,137.33

d21,166.67

38Refer to the previous question: this is a(n)

a.back load annuity

b.front load annuity

c.annuity due

dordinary annuity

39 Parker Corporation is planning to break ground on a new factory. The factory will require an initial cash outlay of $5,000,000 which will be due in July 2023 (five years). How much will Parker need to deposit, or set a-side every quarter, for the next 5 years (20 quarters), in an account that earns 9.35%, in order to have the funds available for this outlay (investment).

a.190,136.22

b.194,303.22

c.195,958.04

d198,958.04

40Let's say you own an apartment building that generates $50,000 a year in cash flows from rent, every year.

If you plan to sell the asset for $1,000,000 in ten years, what is the value (present value) of this asset

Use 6% as your discount rate

a.1,250,631.00Set this up as a compound question. Present value of a lump

b.1,035,325.50sum plus the present value of an annuity

c.926,399.13

d850,325.25

41A 7% coupon rate bond makes annual interest rate payments. Par value is $1,000.

The bond matures in 10 years. The required rate of return is 6.5%. What is the current price

a.850.34

b.972.56Set this up like the previous question. You are valuing a "straight-bond"

c.1,035.94

d1,050.25

Answer rating: 100% (QA)

Operating Margin Operating Income Net Sales 100 Since Operating Margin is not given directly we need more information about Operating Income Gross Profit Margin Gross Profit ... View the full answer