• Q : Determining mobility of international capital flows....
    Finance Basics :

    The mobility of international capital flows is causing emerging market nations to choose among a free-floating currency exchange regime, a fixed currency exchange regime and a currency board.

  • Q : Gold standard and the bretton woods systems....
    Finance Basics :

    Explain the gold standard and the Bretton Woods systems and develop argument as to why this is a good idea.

  • Q : Mobility of international capital flows....
    Finance Basics :

    The mobility of international capital flows is causing emerging market nations to choose among a free-floating currency exchange regime, a fixed currency exchange regime and a currency board.

  • Q : Annual depreciation tax shield for firm....
    Finance Basics :

    What is the amount of the annual depreciation tax shield for a firm with $200,000 in net income, $75,000 in depreciation expense and a 35% marginal tax rate?

  • Q : Determining the minimum cash flow....
    Finance Basics :

    What is the minimum cash flow that could be received at the end of year three to make the following project "acceptable?" Initial cost = $100,000; cash flows at end of years one and two = $35,000; o

  • Q : Determining the opportunity cost of capital....
    Finance Basics :

    The profitability index for a project costing $40,000 and returning $15,000 annually for four years at an opportunity cost of capital of 12% is:

  • Q : Wacc of johnson industries....
    Finance Basics :

    Johnson Industries finances its projects with 40% debt, 10% preferred stock, and 50% common stock.

  • Q : Relevant cost to the firm for taking project....
    Finance Basics :

    MoonDollars Tea Corp. is considering a project that will cost the firm $300,000. In addition the firm has already spent $18,000 on taste tests. What is the relevant cost to the firm for taking this

  • Q : Cost of using additional trade credit....
    Finance Basics :

    The cost of using additional trade credit is approximately 36 percent. Considering only the explicit costs, Judy should finance the expansion with the bank loan.

  • Q : Approximate rate of interest on percent add-on loan....
    Finance Basics :

    The bank offers the choice of a 12 percent discount interest loan or a 10.19 percent add-on, one-year installment loan, payable in 4 equal quarterly payments. What is the approximate (nominal) rate

  • Q : Estimating net present value of investment....
    Finance Basics :

    Kenneth made a $20,000 investment in year 1, received a $5,000 return in year 2, made an $8,000 cash payment in year 3, and received his $20,000 back in year 4. If his required rate of return is 8%,

  • Q : Risk premiums and discount rates....
    Finance Basics :

    Top hedge fund manager Diana Sauros belives that a stock with the same market risk as the S&P 500 will sell at year-end at a price of $50.

  • Q : Risk premium on common stock....
    Finance Basics :

    What was the risk premium on common stock in each year? What was the average risk premium? What was the standard deviation of the risk premium?

  • Q : Purchasing power parity....
    Finance Basics :

    In the spot market 7.8 Mexican pesos can be exchanged for 1 US dollar. A compact disc costs $15 in the United States. If purchasing power parity (PPP) holds, what should be the price of the same dis

  • Q : Determining the currency appreciation....
    Finance Basics :

    Suppose that 1 Danish krone could be purchased in the foreign exchange market for 14 US cents today. If the krone appreciated 10 percent tomorrow against the dollar, how many krones would a dollar b

  • Q : Positive cash flows....
    Finance Basics :

    Golden Corporation is considering the purchase of new, technologically advanced thin film solar panels costing $80,000. The excess electricity from the panels will be sold back to the current electr

  • Q : Difference between call option and put option....
    Finance Basics :

    What is the difference between the call option and put option?

  • Q : Operating or capitalized leases....
    Finance Basics :

    Give an example of a publicly traded company that has either operating or capitalized leases?

  • Q : Holding cash and investing in money market instruments....
    Finance Basics :

    Discuss the trade-offs between holding cash and investing in money market instruments. Then, identify which you lean toward and state why.

  • Q : Ways in which businesses manage working capital....
    Finance Basics :

    Analyze the ways in which businesses manage working capital. Determine the single greatest challenge to small businesses and how those challenges may be addressed. Provide specific examples to support

  • Q : Determining arithmetic and geometric returns for the stock....
    Finance Basics :

    A stock has had returns of 34%, 18%, 29%, -6%, 16%, -48% over the last six years. What are the arithmetic and geometric returns for the stock?

  • Q : Determining the amount of direct labor....
    Finance Basics :

    Jan. 1, 2012 18,500 Work in process inventory, Dec. 31, 2012 22,500 Direct materials used 15,800 Assuming manufacturing overhead costs of $83,375, what is the amount of direct labor incurred by Vill

  • Q : Incorporate substantial analysis-textual comment....
    Finance Basics :

    Your project plan may be better suited to a capital budgeting type of analysis that includes a detailed NPV calculation. How you choose to analyze your company is up to you; however, you must incorp

  • Q : Evaluating expansion program....
    Finance Basics :

    Calculate the weighted cost of capital that is appropriate to use in evaluating this expansion program.

  • Q : Determining value of cash coverage ratio....
    Finance Basics :

    A firm has sales of $68,400, costs of $42,900, interest paid of $2,100, and depreciation of $6,500. The tax rate is 34 percent. What is the value of the cash coverage ratio?

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