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You purchase CSH stock for $40 and it is now selling for $50. The company has announced that it plans a $10 special dividend. Assuming 2008 tax rates, if you sell the stock or wait and receive the div
Consider the following information for three stocks, A,B,and C, and portfolios of these stocks. The stocks' returns are positively but not perfectly positively correlated with one another
A local club is selling Christmas trees and deciding how many to stock for the month of December. If demand is normally distributed with a mean of 100 and standard deviation of 20,
Acme Manufacturing is a decentralized corporation. Divisions are treated as investment centers. In recent years, Acme has been running about 11% ROA for the corporation as a whole, and has a cost of c
Warren Milken is attempting to take over Biotech Corporation. The worth of Biotech depends on the success or failure of several drugs under development.
Sarah owns 45% of the stock in a C corporation that had a profit of $260,000 in 2011. Kevin owns a 45% interest in a partnership that had a profit of $260,000 during the year.
Compute the margin, turnover, and return on investment (ROI) in 2005 for each of FedE's four business segments
Assume that insurers operate in an environment where price regulation does not exist. Describe two potential benefits that this type of system provides to consumers as well as two potential costs.
Suppose nominal GDP in 1999 was $100 billion and in 2001 it was $270 billion. The general price index in 1999 was 100 and in 2001, it was 150. Between 1999 and 2001, the real GDP rose by what percent?
You know from data collected on the Widget Market that market demand and market supply have both increased recently. As manager of the facility, what decisions should you make regarding production lev
What is the weighted average cost of capital for the following firm? It has $500,000 in debt, $200,000 in common stock and $600,000 in preferred stock.
You are considering investing in two stocks to form a portfolio. You are very risk averse (you do not like risk). Which one of the following stock combinations will you choose for your portfolio (thes
What return on equity do investors expect for a firm with a $17 stock price, a dividend in year one of $2.00, a beta of 1.6, and a constant growth rate of 2%?
The basis for a personal use asset converted to business use is the lesser of the asset's cost basis or fair market value on the date of the transfer or conversion.
Over the past year, the Dollar has depreciated about 10% against the Euro. A year ago you took out a home equity loan in the U.S. at an interest rate of 8% and you invested the money in a German mutua
Your company manufactures a quality line of home kitchen appliances, refrigerators, stoves, dishwashers, and so forth, and you are highly competitive with companies such GE, Frigidaire, KitchenAid, Wh
I am a 100% shareholder of Johnson Corp. (an S corporation). At the beginning of 2010, My basis in Johnson Corp. stock was $14,000. During 2010, I loaned $20,000 to Johnson Corp. and Johnson Corp.
A cost-cutting project will decrease costs by $48,500 a year. The annual depreciation on the project's fixed assets will be $11,300 and the tax rate is 34 percent.
Fliers is considering making and selling custom kites in two sizes. The small kites would be priced at $9 and the large kites would be $24. The variable cost per unit is $5 and $11, respectively.
Newton Industries is considering a project and has developed the following estimates: unit sales = 7,300, price per unit = $149, variable cost per unit = $91, fixed costs = $216,400.
Lake City Plastics currently produces plastic plates and silverware. The company is considering expanding its product offerings to include plastic serving trays. Which of the following are cash flows
Explain "opportunity cost" and how it relates to the definition of economics. To illustration this concept, give your explanation of the following decisions that would entail the greatest opportunity
Explain what you think would be an appropriate promotions strategy for the groups listed above. In doing so compare and contrast the two promotions strategies explaining why you think they would be si
Due to a technical breakthough, the fixed costs for a firm drop by 25%. Prior to this breakthrough, fixed costs were $1,000,000 and unit contribution margin was and remains at $5.00.
Ethier Enterprise has an unlevered beta of 1.0. Ethier is financed with 50% debt and has a levered beta of 1.6. If the risk free rate is 5.5% and the market risk premium is 6 %,