Finance Questions and Answers January 12, 2022

You can pay $2,750,000 for annual payments of $100,000 that will start at the end of the next year and go on forever. What interest rate was used to determine the price of this annuity?

RMO is an allequity firm that has never actively managed its capital structure in the past. It currently has 4 million shares outstanding and its share price is at 25. The firms new CEO has heard about the tax shield of debt effect and is fascinated by the idea of increasing the firms market value just by substituting debt for equity. a) If RMO

You are considering a company with revenue 192 million, cost 96 million, depreciation 12 million, interest expense 15 million, tax rate 30%. 1. If you believe that the company should be traded at a price-to-EBITDA multiple of 5, then the company should be worth (million)? 2. If you believe that the company should be traded at a PE ratio of 11,

Find the implied volatility (to 2 decimals, for example, o 8.23) of a Put option with a time to expiration of 11 months and a price of 6.13 The stock is currently trading at 47. The riskless rate is 2 per annum, and the strikeexercise price of the option is 50. Hint compute the Put price using the same formula as in exercise 4, as a function of

The Hardin Balderdash Company has two brands (A B). Price and cost data for each are presented below. Unit price Unit variable cost Unit volumeyear Annual Promotional expense a) A 3.75 4.35 2.15 2.05 755,000 units 1,225,000 units 625,000 675,000 Calculate the contribution margin () and contribution margin ratio () for each brand at the UNIT

Suppose that an investor has an initial long position of 500 dollars in stock A. She wants to use stock B to hedge this position. We have the following parameters SA 100, SB 200, A 0.25, B 0.2, PAB0.20, where S is the initial stock price, o is the volatility of the return, and p is the correlation between the returns. How many units of stock B

Suppose that as part of a stack hedging strategy, you enter a short position of one unit in a forward contract that will need to be rolled over at T 9 months from today. The current spot asset price is So 50. Assume that the CAPM holds. The riskfree rate is RF 3, the expected return on the market is ERM 8, and the beta of the asset is 1.0.

Suppose there is a U.S.based firm that will produce 100 widgets at T 0.5 (6 months). They can either sell the widgets in the U.S. for 1 a piece or in Germany for 1 euro a piece. Assume there are no transportation cost associated with selling widgets. The firm makes the decision to sell domestically or internationally based on the exchange rate

options on an asset are traded on the exchange with intervals of 25 cents for the strike price. Suppose we are building a replicating portfolio consisting of call options andor put options (and no other assets) to approximate the payoffs of a digital call option with K 100 and maturity T. That is, the replicating portfolio needs to have a payoff

Consider a long position of one unit in a put option on a stock with exercise price K 200 and maturity T 2 years. The stocks current price is S 225, the volatility is o 17, and the dividend yield is zero. The riskfree rate is R 3, and the expected (price) return of the stock is 7. All parameters are annual values. What is the 5 monthly Delta

Suppose the return R on a stock satisfies R AY where u and X are fixed and Y has a tdistribution with degrees of freedom. (a) (5pt) If you hold So position in this stock, show that for a one day VaR(a)So( Xtav) where to is the ath quantile of a the tdistribution with degrees of freedon. (Hint P(L VaR(a)) a and L SoR) (b) (5pt) If So 100000,

Hal invested 1200 per year in an IRA each year for 9 years earning 8 compounded annually. At the end of 9 years he ceased the IRA payments, but continued to invest his accumulated amount at 8 compounded annually for the next 4 years. a) What was the value of his IRA at the end of 9 years Answer b) What was the value of the investment at the end

Rich buys a car for 26,000 and has two options for financing. The dealership offers either financing of 0 compounded monthly for 5years, or a 5,000 cash rebate. If Rich takes the rebate, then he will apply the rebate to the cost of the car and finance the remaining balance with a loan for 5years at 2.95 compounded monthly through the Tigers Credit

. The impulse response and input signal h(t) and x(t) for continuous time and hn and xn for discrete time for an LTI system are provided as below a. h(t) u(t) u(t1), x(t) u(t 2) u(t 4), b. h(t) u(t) u(t1), x(t) cos (2nt)u(t) c. h(t) u(t) u(t1), x(t) cos (2nt) d. h(t) u(t) u(t1), x(t) cos (nt) (1t,0 t 1 0, otherwise (2,1t 0 1, 0t 1 2,

Use the following cash flow data to estimate cash forecast using various techniques. Net Cash Flow Period Net Cash Flow 722 16 725 Period 1 2 3 4 S 6 7 8 9 10 11 12 13 14 15 355 314 709 800 350 744 541 834 938 586 840 433 476 525 PASSEIZAHS28 17 18 19 20 21 22 23 24 25 26 27 29 30 521 174 737 833 365 807 788 304 350 793 665 1090 678 485 a. Compare

Assume that we have a commercial real estate property whose projected 5year cash flows are the following Year 150 Year 0 100 Year 1 20 Year 2 25 Year 3 30 Year 4 35 Year 5 140 Assuming a discount rate of 2. Calculate the overall cap rate of the property.

A company sell hats. When the price is 15, they sell 80 hats. If the price drops to 10, then they sell 120 hats. a. Assuming the demand is linear, find the price demand function for the hats. b. Find the revenue function. c. Find the number of hats that will give a maximum revenue. d. Find the price of the hats that gives the maximum revenue.

Use the following information to calculate the monthly mortgage payment amount to purchase a 354,156 home 54,901 down payment 500 per month for estimated combined property taxes and insurance 5 interest rate for 30 years No other costs What would be the total mortgage loan amount

You believe that the appropriate PE ratio is 15. Find the value for each of the stocks below and indicate if you would buy the stock at the current market price. Revenue Expenses Net Income EPS Market Price Value Buy Revenue Expenses Net Income EPS Market Price Value Stock A 10M 8M 2M 1.50 24.00 Buy 2. You believe the appropriate PE ratio is 12.

If the Stock Dividends 25, recorded at fair market value. If the Stock Dividends 25, recorded at book value. Example1 Velvet Company has 5,000 shares issued and outstanding. Par value is 1 book value 32 and market value is 40. Instruction prepare the entries at the different following situations 1 10 stock dividend is declared (market value 40)

If an invoice for 1000 (no shipping) is dated July 14, for goods recieved on July 20, has terms 315, n30 a) Find the last day of the discount period b) If a payment of 300 is made on the last day of the discount period, how much is credited to the invoice. c) When is final payment due, and what is the outstanding balance due on that date d)

General Utility Corp. is going to buy a new equipment that falls into the 4year straightline depreciation to 150,000. The equipment costs its current value of 800,000, its installation costs of 50,000, its shipping costs of 50,000, and its research costs of finalizing the equipment type of 100,000. This specific new equipment has been selected

Calculate the Forward premium(discount) for the EURUSD using the direct rate. Calculate the Forward premium (discount) fot the GBPUSD using the indirect rate. Calculate the EURGBP rate.,Spot Next Three Months Six Months EURUSD USDEUR 1.06849 0.9359 1.07395 1.07917 0.9311 0.9266 GBPUSD GBPUSD USDGDP Spot Next 1.20373 Three Months Six Months 1.2060

A company provides the following information related to its defined benefit pension plan for the current year PBO balance, January 1 PBO balance, December 31 Plan Assets balance, January 1 Plan Assets balance, December 31 Service cost Interest cost Actual return on plan assets Benefits paid to retirees Contributions to plan Assume that there were

In December 2024, a company collected 40,000 in rent for future tenant occupancy. The rent revenue will be earned evenly over the next 2 years (20252026). Tax rates during the period (all known in 2024) are provided below. There are no other differences between accounting income and taxable income in any year. Year 2024 2025 2026 Required 1. Tax

Every workday in 2021, Lorie stopped at a coffee shop and bought coffee and donuts. She spent 100 a week 80 for the donuts and 20 for the coffee. Lorie did not eat donuts and gave them to homeless people that are near her office. In total, Lorie spent 4,000 for donuts and 1,000 for coffee (50 weeks of purchases, 2 week vacation). How much can

The following information is available for Brownstone Products Company for the month of July Master Budget 4,000 60,000 16,000 13,500 8,000 9,600 Units Sales revenue Variable manufacturing costs Fixed manufacturing costs Variable selling and administrative expenses Fixed selling and administrative expenses Required 1. What was the master budget

The Following information relates to the pension plan of SSL limited. 1Jun12 31May13 m m 28 29 30 25 Fair value of plan assets Actuarial value of defined benefit obligation The contributions for the period received by the fund were 4 million and the employee benefits paid in the year amounted to 6 million. The discount rate to be used in any

The Ent Company started 10,800 units and completed 7,200 of those units during the production period in Its Finishing Department. The units in process at the beginning of the period were 60 complete with respect to conversion cost. The units in process at the end of the period were 50 complete with respect to conversion cost. A total of 10,000

Hart Corporation's net income was $400,000 in 2010 and $160,000 in 2011. What percentage increase in net income must Hart achieve in 2012 to offset the decline in profits in 2011?

Which of the following is not an example of the procedure the engagement team can perform to identify subsequent events: 1. engage a specialized resource to audit the subsequent event transactions 2. read the latest interim financial statements 3. obtain a written representation that all the subsequent events that would require an adjustment or

A 1.5-year annuity pays $20,000 every 6 months and returns $400,000 at the end of the 1.5 years. What is the Present Value of this annuity, if the semi-annually compounded interest rate is 8%?

A retailer is considering whether to open a new shop on a vacant block of land it owns. If the company goes ahead with the project, it will construct a new building at a cost of $2,900,000. It will also incur additional expenses of $489,000. The tax office has ruled that the building can be depreciated straight-line over 10 years, but the

Calculate the monthly payment for a 15 year fixed loan at 4.4 per year compounded monthly if you are borrowing 395,000.00. The loan is amortized. Round your answer to the nearest cent. Monthly Payment (month

Sam can afford to make monthly payments of up to 245.00 for a car. A car dealership offers an amortized loan at 1.53 for 6 years. What is the most he can borrow to purchase a car (present value)

Marcie wants to have 1,300,000.00 when she retires in 20 years. She wants to make monthly deposits into an investment account that pays 4 interest compounded monthly. Round your answers to the nearest cent. a) How much does she need to invest each month b) How much interest will she earn from this investment

Finance Rules Corp. uses no debt. It has a WACC of 14%. If the current market value of the equity is $40 million and the corporate tax rate is 35%. Calculate EBIT and WACC.

Gerta Franklin's trip to buy a pair of cowboy boots had been frustrating the 30-mile drive had yielded no boots. The selection available in her size was sparse, but, more important she had been unable to find her desired red boots. Strange, she thought, how life took a turn that day. On the drive home, she realized that many others living in her

Assets Cash Inventory Total assets Prepaid assets Deposits Property and equipment (net) Liabilities Interest payable Taxes payable Accrued expenses Loan Total liabilities Equity Common stock Retained earnings Total equity 3 Exhibit 1 DOUBLE G WESTERN WEAR Balance Sheet 123106 6,280 16,400 5,000 3,000 20,107 100 553 5,000 12,000 30,000 3,134 50,787

Suppose that on June 1, you have a credit card balance of 720.00. On June, 5, you make an Amazon purchase of 114.00. On June 15, you make another purchase of 53.00 at Costco. On June 22, you make a payment of 450.00. On June 26, you make a return at Target of 175.00. The annual interest rate on your credit card is 27. Calculate the finance charge

Edward bought a bond from the Quileute corporation that has 12 years till maturity. The coupon rate is 8. Par is 1000. Semi annual payments, similarly risked bonds yield 7.2. How much should he pay

Find the number of years required for 5,000.00 to grow to at least 10,616.00 when deposited at 3, compounded semiannually (2 times a year). Dont forget to adjust your answer to time in years Round your answer to two decimal places.

Kelly bought stock for 4 per share 12 years ago. Today, the stock sells for 54 per share. She is afraid the stock price will fall to 28 per share or rise to 60 is nothing bad happens. (equal chance) She can buy a put with a strike price of 55 for 5 per share. What is their expected value if no put (5050)

PQWR Corporation has call and put options with a strike price of 25. The risk free rate is 4. It has 90 days till expiration, PQWR stock sell for 22. N(d1) 4 and N(d2) 25 How much should a call sell for

Farmer Carter will harvest 250,000 bushels of corn in 4 months. The current spot rate is 4 a bushel. Forward rate on a 5month Future contract (5000 bushels) is 3.5 a bushel. In 4 months, the spot rate is 3.2 a bushel and the forward rate of the Future contract is 3.0 a bushel. What is the opportunity loss

FOX just paid 1.5 a share in dividends. Fox is expected to grow by 10 a year for the next 2 years before settling to a constant 6 rate in year 3. Ks are 14. What price should Fox sell for in 2 years

How much will you have in your account after 9 years from now, if you deposit $3,259 after 1 year and the bank promises to pay an interest of 11.4% per year?

You have $5000 in your checking account. You just deposited $1000 and wrote a check for $3,500. What is the net float?

Consider a bond with $1,000 par value, 6.875% coupon rate to be paid semiannually, YTM=1.5%. Suppose that the maturity of this bond is Aug 15,2025, and you are valuing the bond for settlement on January 18, 2022. The next coupon is due Feb 15, 2022. Assume a 30E/360 day count convention (30 days in January and 180 days in 6 months). All

You are purchasing an equipment for $ 200,000 for your new store. Assume the store has no other expenses or revenues other than those associated with this project. You are going to purchase an additional $ 12,500 of inventory for production with the new equipment and set up a cash account with a $ 2,000 balance. The inventory purchase will result

Suppose that on June 1, you have a credit card balance of 660.00. On June, 5, you make an Amazon purchase of 139.00. On June 15, you make another purchase of 58.00 at Costco. On June 22, you make a payment of 600.00. On June 26, you make a return at Target of 190.00. The annual interest rate on your credit card is 30. Calculate the finance charge

Triptych Food Corp. is looking at investing in a production facility that will require an initial investment of $500,000. The facility will have a three-year useful life, and it will not have any salvage value at the end of the projects life. If demand is strong, the facility will be able to generate annual cash flows of $260,000, but if demand

A 25-year, 1000-par bond pays annual coupons at a rate of 8% and has a price of 1116.54. Calculate the duration of this bond.

Kitlinger's Men's Wear's accounts receivable turnover rate has gone from an average of 10.6 times to 10.1 times per year. How has this change affected the company's accounts receivable period?

The Sureset Concrete Company produces concrete. Two ingredients in concrete are sand (costs $6 per ton) and gravel (costs $8 per ton). Sand and gravel together must make up exactly 75% of the weight of the concrete. Also, no more than 40% of the concrete can be sand and at least 30% of the concrete can be gravel. Every day 2000 tons of concrete

Find the interest rate (or rates of return) for each of the following situations. Round your answers to two decimal places. He borrows $750 and promises to repay $810 at the end of 1 year. % You lend $750 and receive a promise to repay $810 at the end of 1 year. % Borrows $70,000 and promises to repay $228,277 after 14 years. % Borrows $8,000 and

Your son is born today and you want to make him a millionaire when he is 50 years old. You put $10,700 in an investment account and want to know what annual interest rate you must earn so that the value of the account equals $1,000,000 on your child's 50th birthday.

What is the regular monthly payments you would need to make if you need to pay off a loan of $45,000 in 5 years and interest is 4.8%?

There is a 15 percent chance that the economy will prosper; otherwise it will be normal. Stock G should return 15 percent in a boom and 8 percent in a normal economy. Stock H should return 9 percent in a boom and 6 percent otherwise. What is the variance of a portfolio consisting of $3,500 in G-shares and $6,500 in H-shares?

You are analyzing the purchase of new equipment. Since you are not an expert in this type of equipment, you hire a consulting firm to make recommendations. The consultant charged him $1,500 and recommended the purchase of the latest model from Equipment Corp. of America. The equipment costs $80,000 and it will cost another $10,000 to modify it for

Design 3 manufacture Crane that will load from ground d prototype of a batid Davit be able to lift 3 to lift lower a ground te to the top of a table. The crane will need to be freestanding, no fastening onto the base will be allowed and no electrical Powereel devices may be used. Write a paragraphs in which you explain your concept. Ilus

An Indian Merchant importing goods from UK worth 1 million GBP. But there is no direct quotation between GBP INR is available in the market. The spot rate in the market available is GBP USD 1.2100 INR USD 0.012. a.Calculate the exchange rate between GBP INR using the above information b.Assume that spot quotation between USD INR 80.7400- 80.8700.

Ten years ago, Joe purchased stock for $46K. Joe is in bad health. He needs to decide how to transfer the stock in the family most tax-efficiently. Its current value is and is expected to remain $6K. Options: gift the stock to his wife or gift stock to daughter. The other option is to essentially do nothing. His wife and daughter are sole

An investment of $100 generates after-tax cash flows of $40 in year 1, $80 in year 2, and $120 in year 3. The required rate of return is 20 percent. calculate The net present value.

The Candy Company had sales of $320,000 and cost of sales of $112,000. What is the gross profit margin (ratio of gross profit to sales)?

PC Replacements offers a PC processor for 383.39 less a series discount of 1618. PC Upgrades offers the same processor for 333.39 less a series discount of 1113. Find the net price for both retailers, and the difference between the two prices. What is the net price of a PC processor from PC Replacements (Round to the nearest cent as needed.) What

Calculate the change in cash for the following information:

Increase in AR Decrease in Inventory Decrease in Accounts Payable Increase in Taxes Payable Issued Long Term Debt Issued Common Shares Issued Dividends 5,000 25,000 10,000 2,500 300,000 250,000 60,000

ABC Corp. provides you with the following data: Sales: $500,000;Operating profit: $300,000;Interest expense: $25,000;Net Income: $100,000;Common Stock (at par): $10,000;Capital paid in excess of par: $210,000;total number of common shares outstanding: 10,000. to.Given the above (and assuming there are no float costs), what was the price of a

As part of your retirement package, your company has agreed to pay you monthly payments over the next three years that have the following characteristics. 1. You will receive 12 monthly payments each year, with the first payment for the year being made on January 1st, and the last payment for the year being made on December 1st. 2. Monthly

If a firm is selling financial calculators for $25 per calculator, if the variable cost per calculator is $17 and the fixed cost is 90,000, find the following: 1- What is break-even point to this firm by units and by dollar amount? 2- what is the number of the units (calculators) that the firm need to sell in order to have EBIT equal to

A Tesla model 3 can be purchased for $40,000. If borrowing rates are 0.5% per month for a term of 6 years with monthly payments, what is the payment each month starting one month from today when the total amount of $40,000 is financed?

You would like to have $5000 in savings at the end of 5 years. How much money, in equal annual amounts, must be invested at the end of each of the next five years in order to achieve your goal? Your current savings balance is $500 and the interest rate you expect to earn over the next 5 years is 6.5% per year.

Given CDS spreads with the following tenors Tenor CDS Spread 1 1.0 2 1.2 3 1.4 4 1.6 1.7 5 RN Default Prob Risk free rate of 5 flat continuously compounded and a recovery rate of 40. What are the risk neutral default probabilities for each year What is the value of an existing 5year CDS with a 200bp spread What is the par 5year Binary CDS spread

You project NOI for a given industrial property and estimate NOI in year 6 to be $780,000. What is your estimated sale price for the building in year 5 based on a 6.5% cap rate?

Given the following information, calculate the current ratio. Noncurrent assets 100,000 Total assets 150,000 Longterm liabilities 45,000 Shareholders equity 65,000

Based upon the correlation table below, which characteristic is the strongest predictor of sales Sales Income renters House price Crime rate Sales 1 0.3472 0.4166 0.2811 0.2355 Income 1 0.3167 0.5217 0.3187 renters 1 0.1134 0.1521 House price 1 0.2663 Crime rate 1

The following firm pays no cash dividends and is not expected to for the next several years. Consider the following data Humphrey Chemical, Incorporated Earnings Per Share (Time0) Market Capitalization Rate Humphrey Chemical, Incorporated Plowback Rate Return on Equity 17 18 19 20 21 22 Time 1 2.00 0.14 Required 3 Using the information in the

You are given the following total market values for an index over a fiveyear period. Assuming the index starts at 1,000, calculate the index value each year. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Market values Year 1 5,514 million Year 2 5,826 million Year 3 5,654 million Year 4 5,103 million Year 5

4. Given the following yields for bonds with different credit ratings Credit Rating Yield 3 AAA AA 3.2 A 3.5 BBB 3.8 BB 4.5 B 5.25 a. What would be the fair price of a 5year maturity bond, which currently has identical risk to a bond rated A, if it has a coupon rate of 12 paid annually, and a par value of 1,000 b. What would be the price of the

United Banks pays a 4% simple interest on its saving account. Federal Banks pays 4% interest compound annually on it saving account. If Ron invests $1,000 in each bank how much will he have in account after 20 Years? 2. Future Value Sharon invests $3,000 in the stock Market today. Assume she earns 9% annual rate of return. How much money will her

2. You have two job offers with the following 6year compensation terms the first one offers you 80,000 a year for the next 6 years the other one offers you a signing bonus of 15,000 plus 50,000 a year for the first 4 years and then 60,000 a year for the last two years. Assume that the appropriate discount rate is 12 and there are no taxes. a. How

Gone Pro is considering whether or not to produce three new cameras and, if so, how many of each. Each product needs to go through three production stages machining, assembly, and testing. The table below shows how much time each product spends in each manufacturing stage and the total time available that they have contracted for each stage. The

Triad Healthcare Financial Data 12312016 Cash 400,000 AR 150,000 1,000,000 700,000 350,000 Mortgage 600,000 Revenue 1,000,000 Expenses 1,150,000 Building Land AP What should Triads total fund balance be on its yearend balance sheet

The beta for ABM Industries is 1.50. Assuming that the nominal risk-free rate is 6.0% and that the return to the market is 9.0%, what is ABM's required return?

You analyzed the latest economic indicators and came up with the following probability distribution for the state of the economy next year expansion 20, normal growth 60, and recession 20. You are considering creating a portfolio with two stocks Eren Corp and Mikasa Inc (you are going to buy 1 share of each company). Their past returns during

Koda's Manufacturing has a required return of 9.50%. If the market return is 13.0% and the nominal risk-free rate is 6.0%, what is Koda's beta?

Widget Corp. has to choose between two mutually exclusive projects. If it chooses project A. Widget Corp. will have the opportunity to make a similar investment in three years. However, if it chooses project B, it will not have the opportunity to make a second investment. The following table lists the cash flows for these projects. If the firm

You source Ice Cubes to sell in the US from an Eskimo village and you owe them 4,000,000 Danish Kronas (DKK), which is due in 60 days. If the currency exchange rates and interest rates are as follows (see Data Table 1), what is your hedging decision You have to explore each hedging alternative (by answering questions below) and choose the best

A friend wants to borrow money from you. He states that he will pay you 4,000 every 6 months for 8 years with the first payment exactly 3 years and six months from today. The interest rate is an APR of 6.3 percent with semiannual compounding. What is the value of the payments today

Examine the following data: Sales volume corresponding to breakeven point = 15,000 units, Sales volume corresponding to cash flow point = 12,000 units, Project life 5 years, Fixed costs $ 120,000, Variable costs = $ 20 per unit, Minimum required profit = 10%. Determine the sales volume corresponding to the financial break-even point.

Suppose that the 120-day forward rate is F=190/$. The spot rate is S=180/$. Find the forward premium or discount for the yen. Do not use any unit. Also, make sure to round your answers to the nearest 10000th decimal points.

Unit price: $ 35 ;Variable cost per unit: $ 17 ;Fixed costs: $ 7,000; Straight-line depreciation; Discount rate: 10% ;Duration of the project: 5 years Investment: $ 12,000 What is the financial break-even point?

GAME is also thinking of expanding by acquiring Online All the Time, Inc. (Online) to accelerate its streaming gaming platform. Assume the pre-merger (fair value) Online is $25.00 per share and there are 2 million shares oustanding. Online has no debt and since it is in high growth mode, there is no excess cash. GAME believes that combining the

Anderson furniture has an unleveraged cost of capital of 10%, a tax rate of 34%, and earnings before interest and taxes of $ 1,600. The company has $ 3,000 in bonds, with an 8% coupon rate and payments are made on an annual basis. Bonds are sold at their nominal value . What is the cost of equity?

Compute the operating cycle based on the following information: Inventory Period = 36 Accounts Receivable Period = 29 Accounts Payable Period = 25 Question 4 Month Sales $ Month Sales $ Jan 35,230 July 49,671 Feb 25,211 Aug 27,787 Mar 27,787 Sep 35,230 Apr 49,671 Oct 27,787 May 35,230 Nov 25,211 June 25,211 Dec 49,671 The table contains the Sales

Your states highway maintenance department is considering whether to buy an asset that delivers an annual benefit of 4.5 million each year it is in use, but the department does not know how long the asset will last. Instead, the department believes the lifetime of the asset is uniformly distributed with a minimum lifetime of 16 years and a maximum

The firm has Total Assets of $6.6 million, Current Assets of $4.9 million, Inventory of $1.6 million, Total Liabilities of $4.7 million, and Current Liabilities of $4 million. Calculate the quick ratio.

You are a financial analyst at a major business valuation firm. You are analyzing how a change in beta will impact the present value of corporation that is considering an investment project. The project requires an initial investment of $100 million and will generate a perpetuity of after tax cash of $15 million every year forever. The projects

Alfred receives a small inheritance of 40,000 that accumulates at a force of interest of 4 continuously. If Alfred withdraws money continuously at the rate of 2,000 per year, find the time for which the inheritance is depleted.

It's 2021, and IBM has just paid its 2020 dividend. Using the table, you want to estimate IBM's current stock price. Assuming historical dividend growth is a reasonable proxy for the future, you estimate that IBM will continue to grow its dividends, forever, at the same rate it has demonstrated over the past 3 years. If the required rate of return

Year 2018 2019 2020 Dividend Amount 4.00 4.20 4.41

Dawgpound Incorporated has a bond trading on the secondary market that will mature in four years. The bond pays an annual coupon with a coupon rate of 4.50% and has a face value of $1,000.00. Based on the economy and risk associated with Dawgpound, you seek a 11.75% return on Dawgpound debt. What price are you willing to pay for the bond?