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Calculate the press brake's net present value. Is the project acceptable? What is the meaning of the computed net present value figure? What is the project's internal rate of return?
Assume the real rate of return in the economy is 2.5%, expected rate of inflation is 4%, and the risk premium is 5.9%, what are the risk-free rate and your required return?
Assume you purchase 100 shares of Walgreen stock at $50 per share on margin (50%), if the prices rises to $60 per share, what is your percentage gain in equity? What if the stock drops to $35 per sh
Predator Pucks, Inc. has current assets of $8,000, net fixed assets of $45,000, current liabilities of $6,800, and long-term debt of $13,800. What is the value of the shareholders' equity account fo
Write a synthesis about Enropean Financial crisis and its global effects
What are the advantages and disadvantages of metal backed currency and fiat backed currency? Which is most favored, and what is the greatest weakness in the one favored?
In recessions often companies ask their treasurer's to increase investment yields in order to improve profitability and counter operating losses.
A bond with a coupon rate of 7% makes semiannual coupon payments on January 15 and July 15 of each year. The Wall Street Journal reports the ask price for the bond on January 30 at 100:02. What is t
A proposed project has fixed costs of $36,000 per year. The operating cash flow at 18,000 units is $58,000. What will be the new degree of operating leverage if the number of units sold rises to 18,
It is estimated that the company's dividend will grow at a rate of 20% per year for the next 2 years, then at a constant rate of 7% therafter. The company's stock has a beta of 1.2, the risk free ra
All of the net working capital will be recouped after 4 years. The expected annual operating cash flow is $218,000. What is the project's internal rate of return if the tax rate is 35 percent
Your colleague recommends a large corporate board made up exclusively outsiders. She is very concerned about the sensationalized corporate scandals in recent years. Do you agree with her recommendat
All of the following are criticisms of the payback period criterion except:
You are estimating the cost ($K) of optical sensors based on the radius of the sensors. Using the preliminary calculations from a data set of 8 sensors, determine the equation of the line.
You plan to make 5 deposits of $1,000 each, one every 6 months, with the first payment being made in 6 months. You will then make no more deposits. If the bank pays 6% nominal interest, compounded
What is the break-even level of output? What is the level of profits at sales of 9,000 units?
A corporation enters into a $35 million notional principal plain vanilla interest rate swap. The swap calls for the corporation to pay a fixed rate and receive a floating rate of LIBOR.
P & P Communications has a weighted average cost of capital of 9.5 percent. The company's cost of equity is 15.5 percent, and its pretax cost of debt is 8.5 percent. The tax rate is 34 percent.
The stock sells for $32 a share. What is the estimated cost of equity using the average of the CAPM approach and the dividend discount appr
The firm is analyzing a new project which requires an initial cash outlay of $420,000 for equipment. The flotation cost is 9.6 percent for equity and 5.4 percent for debt. What is the initial cost o
Discuss the concept of duration, its uses and limitations, and precisely how it measures risk.
What is the return on stockholders' equity for a firm with a net profit margin of 4.9 percent, sales of $350,000, an equity multiplier of 1.6, and total assets of $215,000?
Given the following costs related to the pro- posed project, explain whether each would be treated as a sunk cost or an opportunity cost in developing the relevant cash flows associated with the pro
Working capital is expected to increase by $5000 at the inception of the project, but this amount will be recaptured at the end of year five. What is the incremental free cash flow for year one? Wha
The premiums of an insurance policy are $50 per quarter, payable at the start of each quarter. If a policyholder wants to pay one year's premiums in advance, how much should she pay, given interest