Question 1: How much would you expect to receive for a nominal interest rate in Holland if funds can be invested in the U.S. at a rate of 7% when inflation is expected to be 4% in the U.S. and 8% in Holland?
Question 2: The company cost of capital for a firm with a 60/40 debt/equity split, 8% cost of debt, 15% cost of equity, and a 35% tax rate would be:
Question 3: An investor receives a 15% total return by purchasing a stock for $40 and selling it after one year with a 10% capital gain. How much was received in dividend income during the year?
Question 4: What is the current price of a share of stock for a firm with $5 million in balance-sheet equity, 500,000 shares of stock outstanding, and a price/book value ratio of 4?