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A financial managermust decide what to do with the cash flows of her company. The anticipated rate of inflation exceeds the anticipated rate of return on investment. What might that manager reasonab
If the firms sales average $2 million a month, what is the average investment in acounts receivable? What is the annual cost to the firm of offering the trade discount?
will be used to repurchase. Assuming that individuals have the same borrowing opportunities as coprations, explain how an investor can undo the leverage that is proposed by Magnifence Inc. Under tho
Consider a four-year project with the following information: initial fixed asset investment = $440,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $25; v
Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within ±10 percent.
A company has $5,800 in sales. The profit margin is 4%. There are 5,000 shares of stock outstanding. The market price per share is $1.70. What is the price-earnings ratio?
A firm has sales of $3,550, total assets of $3250, and a profit margin of 4%. The firm has a total debt ratio of 40%. What is the return on Equity?
The risk-free rate of return is 3.0 percent and the market risk premium is 10 percent. What is the expected rate of return on a stock with a beta of 1.2?
Shares of common stock of the Samson Co. offer an expected total return of 21.2%. The dividend is increasing at a constant 5.8% per year. What must be the dividend yield?
How are market conditions in the US and the company's country of origin factored? Why is it important to perform a post-IPO risk and growth analysis?
If Sterling's debt-to-equity capitalization ratio is .20 and its debt beta is also .30, what is your estimate of the firm's equity beta?
The firm currently has 25,000 shares of common stock outstanding, and the previous year's dividends per share were $1.25. Assuming a 34 percent income tax rate, what was the times interest earned ra
Jiminy Cricket Removal has a profit margin of 11 percent, total asset turnover of 1.13, and ROE of 14.33 percent. What is this firm's debt-equity ratio?
Assume there is a 12- year, 9.5% semiannual coupon bond, with a par value of $1000. The bond sellsy for $1,152. A. What is the bond's yield to maturity. B. What is the bond's current yield?
Calculate the net present value (NPV) for the following 20-year projects. Comment on the acceptability of each. Assume that the firm has an opportunity cost of 14%
The risk-free rate of return is 4.6 percent and the market risk premium is 12 percent. What is the expected rate of return on a stock with a beta of 1.2?
Your organization has been asked to invest in a continuing care retirement center. Your investment will be $600,000 per year for the next five years. After five years, cash flows will be $400,000 pe
This bond is currently selling for 92 percent of its face value. What is the company's pre-tax cost of debt?
Your portfolio has a beta of 1.33. The portfolio consists of 14 percent U.S. Treasury bills, 25 percent stock A, and 61 percent stock B. Stock A has a risk level equivalent to that of the overall ma
Jensen's Travel Agency has 9 percent preferred stock outstanding that is currently selling for $30 a share. The market rate of return is 10 percent and the firm's tax rate is 34 percent. What is Jen
find an article about a company reporting key financial news (e.g. landing a large contract, reporting unusual profits or losses, expressing concern for future profitability, etc.).
Assume that for a 5-year period, large-company stocks had annual rates of return of 21.04 percent, -9.10 percent, -11.89 percent, -22.10 percent, and 28.89 percent. What is the variance of these ret
Why should companies use a project's net cash flows rather than its accounting income when determining a project's NPV? What are the major types of project risk?
You estimate that you will owe $42,800 in student loans by the time you graduate. The interest rate is 4.25 percent. If you want to have this debt paid in full within six years, how much must you pa
Discuss an advantage or disadvantage of the probate process, OR, Discuss the properties of a valid will, OR, describe the consequences of dying intestate in your State.