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The company's last dividend, D0, was $1.25, its beta is 1.20, the market risk premium is 5.50%, and the risk-free rate is 3.00%. What is the current price of the common stock?
If the price of the common stock rises to $25 on this date next year, what would your rate of return be if you bought a convertible bond today and sold it in one year? Assume on this date next year,
Today, Snack Foods, Inc. is investing $311,000 in some new potato chip-making equipment. The company expects the cash flows to increase by $70,000 a year for the next three years and $95,000 a year
Which one of the following increases cash?
Show all necessary calculations required to evaluate Forrester's proposed relaxation of credit standards.
Mama Leone's operates 250 days per year and maintains a minimum inventory level of 2 days' worth of cheese as a safety stock. If the lead-time to receive orders of cheese is 3 days, calculate the re
During the slow winter period the firm holds $10,000 in cash, $55,000 in inventory, $40,000 in accounts receivable, and $35,000 in accounts payable. Calculate Icy Treats' minimum and peak funding re
Highway Express has paid annual dividends of $1.16, $1.20, $1.25, $1.10, and $0.95 over the past five years respectively. What is the average dividend growth rate?
If the bank holds $65 million in deposits and currently holds bank reserves such that excess rerves are zero, what required reserve ratio is implied?
What is the system's current book value? If Largo sold the system for $110,000, how much recaptured depreciation would result?
Its cost of equity is 19 percent, the cost of preferred stock is 6.5 percent, and the pre-tax cost of debt is 7.5 percent. What is the firm's WACC given a tax rate of 34 percent?
Which one of the following will increase net working capital? Assume the current ratio is greater than 1.0.
You hold the positions in the table below. What is the beta of your portfolio? If you expect the market to earn 12 percent and the risk-free rate is 3.5 percent, what is the required return of the p
What trends are reshaping financial institutions' regulation today? Why has capital regulation become so important?
Calculate the cost of capital for the individual components in the capital structure, and then calculate the weighted average cost of capital for Seabreeze. Consider after-tax cost of capital in you
Billings, Inc. common stock has a beta of 1.2. If the expected risk free return is 4% and the expected market risk premium is 9%, what is the expected return on Billing's stock?
How would you properly hedge the revenues using futures contracts? Discuss why, how much you will be over or under-hedged, and the risks.
Calculate the monthly payment on a fixed-rate mortgage of $150,000, with 12% interest, over 30 years.
You financed $10,500 and are making regular payments of $285.00 over the 4 year life of the loan. You would like to pay off the loan a year early. Calculate the unearned interest by.
What is the add-on interest rate (to the nearest tenth of a percent) for a 4 year loan with monthly payments of $210 if the original amount borrowed was $7500?
According to the balance sheet, if the preferred stock pays a dividend of $2 per share, the beta of the common tsock is .8, the market risk premium is 10%, the risk free rate is 6%, and the firm's t
The SIMPLEX financial system is characterized by a require reserves ration of 11 percent; initial excess reserves are 1 million, and there are no currency or other leakages.
Without the new SUV, Ford expects to earn pre-tax income of $80 million from operations next year. Ford pays a 30% tax rate on its pre-tax income. What is the amount Ford owe in taxes next year with
Suppose that 60% of FFL's current overnight photo customers, half would start taking their film to a competitor that offers one hour photo pocessing if FFL fails to offer the one hour service. What
The total annual payments will be level at $3,300 until a final smaller annual payment suffices to pay off the loan. Find the amount of the final sinking fund deposit.