1. A firm is wondering whether to sell goods to a customer on credit or not. The revenues from sale will be Rs 10,000 and the cost of sale will be Rs 8000. What should be the minimum probability that the customer will pay in order to sell profitably? ( this is financial management problem)
2. What is asset accumulation method of company valuation?
Please compare asset accumulation, market capitalisation, book value, and future earnings methods.
3. Show Excel equation(s) used:
If a bond with 20 years to maturity and a coupon rate of 7.5% (paid annually) is selling for $895, what is the yield to maturity for this bond? Provide a brief description of what the term “yield to maturity” means.