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Which bond suffers the greatest percentage price decline? Why? Which suffers the least percentage price decline? Why?
Plot the time path of the prices for each of the two bonds (x-axis = years to maturity; y-axis = bond value)
You have two stocks in your portfolio. $20,000 is invested in a stock with a beta of 0.6 and $40,000 is invested in a stock with a beta of 1.4. What is the beta of your portfolio?
Suppose that you have a growing perpetuity that starts next year with a $166.91 payment, grows at 7.6% and has a discount rate of 14.3%. What is the present value of this perpetuity?
(calculating the rate of return) A friend promises to pay you $500 three years from now if you loan him $400 today. What interest rate is your friend offering you?
But as part of the offer, JCH also agrees that at the end of the next year, it will buy the shares back from you for $25 per share if you desire. Suppose the current one-year risk-free rate is 6.18%
Which of the final 12 discussion area would be most difficult for you as a manager to discuss in the organization with your colleagues? Why?
What is the change in net working capital for the following project? Inventory levels increase $4,000, accounts receivable increase $1,000, additional machinery will be needed in the amount of $120,
Cell Tower stock has a current market price of $43 a share. The one-year call on Cell Tower stock with a strike price of $44.5 is priced at $3 while the one-year put with a strike price of $44.5 is
Month Sales Month Sales January $15,000 March $25,000 February 20,000 April (projected) 30,000 a. Under these circumstances, what should the balance in accounts receivable be at the end of April? b.
The company has the following independent investment projects available: Project Initial Outlay IRR 1 $100,0000 10% 2 $10,000 8.5% 3 $50,000 12.5%
If you were also a vice president of Company X, might your actions be different than if you were the CEO of some other company?
Compute the EPS and the price (P/E stays constant) after the new prodcution facility begins to produce a profit.
Explain the role of Organization Culture in a company with regard to both the CEO and employees. How would organization culture be related to social responsibility?
Assume that the American Health Systems can earn 9% on the proceeds of the stock issue in time to include them in the current years results. Calcualte earnings per share. Should the new issue be und
Proform a income statement Pro forma balance sheet Sales $ Assets $ Debt $ Costs Equity Net income $ Total $ Total $ Determine the external financing needed. (Negative amount should be indicated by
Why do you think that the article is important in understanding diversification benefits that international bonds provide?
Calculate the firm's quantities supplied in the two markets, prices charged and profits at real exchange rates (RS domestic per foreign currency) of 2 and 2.5.
What are the strengths and weaknesses of each primary competitor in terms of sales, quality, distribution, price, production capabilities, reputation, and products/services?
Assuming a federal income tax rate of 34%, what was the Delta Ray Brands net income after-tax?
Calculate the firm's weighted average cost of capital where the firm's borrowing rate on debt is 7.8%, it faces a 35% tax rate, and the common stockholders require a 20.3% rate of return.
For example, if a 1-year loan is stated as $20,000 and the interest rate is 10%, the borrower "pays" 0.10 × $20,000 = $2,000 immediately, thereby receiving net funds of $18,000 (=$20,000-$2,00
A riskless zero-coupon (no intermediate/periodic coupon payments) bond that will pay $1,000 in 10 years is selling today for $350. What implied rate of return does the bond offer?
Set up the amortization schedule for a 5-year, $1 million, 9 percent term loan that requires equal annual end-of-year payments plus interest on the unamortized loan balance. What is the effective in
What is it worth if the discount rate increases to 6% because of some risk? Show your calculation. What are the implications of a higher interest rate?