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A Treasury bond that matures in 10 years has a yield of 3%. A 10-year corporate bond has a yield of 10%. Assume that the liquidity premium on the corporate bond is 0.6%. What is the default risk pre
By how much does the required return on the riskier stock exceed the required return on the riskier stock exceed that on the less risky stock? Round your answer to two decimal places.
The portfolio's beta is 1.15. Now, suppose you sell one of the stocks with a beta of 1.0 for $7,500 and use the proceeds to buy another stock whose beta is 1.55. Calculate your portfolio's new beta.
The following information is available in general and about investments in stocks J and K.
A firm is planning to lower its ACP by ten days next year. Receivables are currently $15M on credit sales of $120M Credit sales are expected to grow by 20% next year. Calculate next year's ending re
Analyze the process of forecasting financial statements and make at least one recommendation for improving the accuracy of forecasts.
What are the major constants in designing the optimal merchandise mix?
A firm has targeted a 20% growth in sales this year. Last year's cash as a percent of sales was 10%, accounts receivable 30%, and inventory 25%. What percentage growth in current liabilities is requ
Given the estimated sales forecast and the estimated relationship between inventories and sales, what are your forecasts of the company's year-end inventory level? Round your answer to the nearest h
The assets of Dallas & Associates consist entirely of current assets and net plant and equipment. The firm has total assets of $2.6 million and net plant and equipment equals $2.1 million.
Calculate Brauer's profit margin assuming the firm uses only debt and common equity. Round your answer to two decimal places.
Discuss the biggest ethical concern(s) you have with investing your own money or offering advice to other people investing theirs, and the possible impact these ethical concerns may have on the mark
Assess your current comfort level to exposure to risk and determine if that comfort level is in your best interest when making investment decisions. Explain your rationale.
Compare and contrast the potential benefits of the domestic securities market to those investing in the foreign securities markets. Provide specific examples to support your response.
Discuss the pros and cons of investing in the securities market and whether such investments would be a good investment for you personally right now. Explain your rationale.
If the company could get the funds from a bank at a rate of 12%, interest paid monthly, based on a 365-day year, what would be the effective cost of the bank loan?
The firm's new CFO believes that the company could reduce its inventory enough to reduce its ICP to the benchmarks' average. If this were done, by how much would inventories decline? Use a 365-day y
What is the maximum dollar amount of costly trade credit the firm could get, assuming it abides by the supplier's credit terms? (Assume a 365-day year.)
If you bought this option for $510.25 and Delva's stock price actually dropped to $60, what would your pre-tax net profit be?
By how much would the AFN for the coming year change if Howton and Howton increased the payout from 10% to the new and higher level? All dollars are in millions.
The higher the firm's flotation cost for new common equity, the more likely the firm is to use preferred stock, which has no flotation cost, and retained earnings, whose cost is the average return o
The local hospital has just implemented a totally automated switchboard that cost $205,000 to install. The switchboard replaced four operators who were paid $15K annually.
Jack and Jill have just had their first child. If college is expected to cost $15,000 per year in 18 years, how much should the couple begin depositing annually at the end of each year to accumulate
What is the implied interest rate on a Treasury bond ($100,000) futures contract that settled at 100'16? If interest rates increased by 1%, what would be the contracts new value? Answer according to