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If the appropriate discount rate for the following cash flows is 8.4 percent, what is the present value of the cash flows?
If the target company has 20 million shares outstanding and you want to purchase 100% of the shares, what is the maximum price per share you would be willing to pay? Why? Would you try to negotiate
You are considering a project which will provide annual cash inflows of $4,500, $5,700, and $8,000 at the end of each year for the next three years, respectively. What is the present value of these
TOP Inc. pays didivdend of $20 next year. The dividends will grow at 12% per years for 14 years, 0% for 5 years, 6% for 14 years, and 3% forever. If you required returns are 12% for the first 20 yea
In addition, you will receive $20 every ten years forever. Find the present value of this investment today if the discount rate is 10% (per year).
Geometric Return Calculation for the three funds and for three secuity, equally weighted portfolio.
You have projected that next year there is: a 10% probability the stock will equal $1, a 20% probability the stock will equal $18, a 30% probability the stock will equal $23, a 30% probability the
E-Eyes.com Bank just issued some new preferred stock. The issue will pay a $13 annual dividend in perpetuity, beginning 10 years form now. If the market requires a 9 percent return on this ivestment
The sausage system will save the firm $96,000 per year in pretax operating costs, and the system requires an initial investment in net working capital of $22,400. If the tax rate is 35 percent and t
Explain what is meant by "the moment of truth" and why it is critical when providing services.
A Japanese company has a bond outstanding that sells for 94 percent of its ¥100,000 par value. The bond has a coupon rate of 5.30 percent paid annually and matures in 15 years.
The real risk-free rate is r* = 3.0%, the inflation premium for 5-year bonds is IP = 1.75%, the liquidity premium for Koy's bonds is LP = 0.75% versus zero for T-bonds, and the maturity risk premium
What will be the Feds target for the Prime Rate? What do you think will be the results on employment of using this new target for monetary policy?
The beta of a project under analysis is 1.4, with expected net cash flows estimated to be $1,500 per year for five years. The required investment outlay on the project is $4,500. What is the require
You own 10 shares of Standard Motors bonds. These bonds pay an annual coupon payment of $100 dollars, have a par value of $1000 and 10 years until maturity. Standard Motors is having financial diffi
In 2-3 paragraphs explain that If you were a credit analyst who approved or disapproved commercial loans, which financial statement(s) and financial ratios would you be most concerned with? Which wo
Inside directors should constitute the majority of a corporate board, because insiders have superior understanding of the firm's business operations.
Construct the balance sheet for this depository financial institution. Could this be the balance sheet for St. Ann's Credit Union or Bank of America? Explain fully the reasons for your choice.
Bavarian sausage just issued a 10 year 12% coupon bond. the fave value of the bond is 1000 and the bond makes semiannual coupon payments. if the bond is trading at 867.25, what is the bond's yield t
A proposed new investment has projected sales of $825,000. Variable costs are 55% of sales, and fixed costs are $187,150 per year. Depreciation is $91,000 and the corporate tax rate is 35%. What is
The terms of the loan require you to make 12 equal end-of-month payments each year for 5 years and then an additional balloon payment of $5,000 at the end of the last month. What will your equal mon
What is the Payback Period for this project? What is the NPV of this project, if the discount rate is 8.6%? Should the firm accept this project? What is the IRR of this project? Should the firm accept
Apocalyptica Corporation is expected to pay the following dividends over the next four years: $5.20, $16.20, $21.20, and $3.00. Afterwards, the company pledges to maintain a constant 5.50 percent gr
The bonds have 25 years to maturity and sell for $890.78. The market risk premium is 8%, T-bills are yielding 5%, and Greenfield's tax rate is 25%. Answer the following questions. What is the firm's