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Riskless Assets for Treasury Bonds

Suppose you own $1 million worth of 30-year Treasury bonds. Is this asset riskless? Why or why not? B. You own $1 million worth of 90-Day Treasury bills ("T-bills"). You "roll over" this investment every 90 days by reinvesting the proceeds in another issue of 90-day T-bills. Is this investment riskless - why? Is it m

Opportunity Cost Toyota

Assume the US can produce Toyotas at the cost of $18,000 per car and Chevrolets at $16,000 per car. In Japan, the cost of producing Toyotas 1,000,000 yen, and the cost of producing Chevrolets at 500,000 yen. In terms of Chevrolets, what is the opportunity cost of producing Toyotas in each country?

Break even in terms of EBIT

3. Canvas Reproductions has fixed operating cost of $12,500, variable operating costs of $10 per unit and it sells paintings for $25 each. At what level of unit sales will the company break even in terms of EBIT

Financial Decison Case Study

Hello-- Please provide assistance with the attached case study. I am completely lost and don't know where to begin. The case is making financial decisions on the time value of money. Please see attached. Your assistance will be greatly appreciated. Assume today is August 1, 2006. Charles is 30 years old and has a Bachel

Finance Questions

Hello, I already have this done, however I want to be sure that I am correct with my answers and understand this properly. I need this rather quickly and any help would be greatly appreciated. Thanks! 1. The goal of the firm should be the maximization of profit. (True/False) 2. For the risk-averse financial manager, the mo

Standard deviation and Variance on excel.

Use the data below to answer the determine variance and standard deviation. (note: carry your calculator out to 4 decimal places). Year Actual Return Average Return Deviation for the Mean Squared Deviation 1 .12 .103 .017

Stephens Security has two financing alternatives

A2. (Comparing borrowing costs) Stephens Security has two financing alternatives: (1) A publicly placed $50 million bond issue. Issuance costs are $1 million, the bond has a 9% coupon paid semiannually, and the bond has a 20-year life. (2) A $50 million private placement with a large pension fund. Issuance costs are $500,000, t

Market price of a stock.

The Extreme Reaches Corp. last paid a $1.50 per share annual dividend. The company is planning on paying $3.00, $5.00, $7.50, and $10.00 a share over the next four years, respectively. After that the dividend will be a constant $2.50 per share per year. What is the market price of this stock if the market rate of return is 15%?

Investment opportunity

You are considering an investment opportunity that costs $250,000 and will return 14% on your investment. There are higher returning investments available in the financial markets that are comparable to this investment opportunity in terms of risk. However, a bank offers to lend you $250,000 at 7%. Should you undertake this inve

2 patent problems - amortization expense

1. ELO Corporation purchased a patent for $180,000 on September 1, 2006. It had a useful life of 10 years. On January 1, 2008, ELO spent $44,000 to successfully defend the patent in a lawsuit. ELO feels that as of that date, the remaining useful life is 5 years. What amount should be reported for patent amortization expense for

Small cap funds and retirement funds

When investing in a retirement fund, what are the main factors to affect your decision? If a small cap fund seems to have the most volatile returns of all offered and also has the highest expenses, why would you want choose this one over others?

Return of investments

Why does (ROI)Return of investments plays such an important role in the way training is designed?

Cost benefit analysis Examining Present-Values

Scenario 1: Present-Value Calculation The following simple present-value formula shows the effect of discounting on the cost of a public policy. In the formula, the discount rate will be set at (1 + r)time where: 1= a constant r = a selected interest rate time= a period of time, usually a year The formula

Risk-Free Zero Coupon Bond

1. Suppose prices for risk-free zero coupon bonds of 100 face value with different maturities are: 1 year 93.50, 2 years 85.75, 3 years 77.25 Determine the discount rate for one, two and three-year cash flows. 2. A risk-free 5% annual coupon bond has a remaining maturity of three years, just having paid its annual

Mutual fund investing

In a mutual fund 401(k)that you have through work, you notice that for every dollar you invest, your company also invests a dollar. (You are able to invest up to 5% of your annual income, and your company has a 5% match.) What return on your investment does this represent? What does your answer suggest about matching programs

Profits and Cash Flows at Current Volume

2007 2010 2012 Automotive Revenue $178 billion $178 billion $178 billion Structural Cost $53 billion $44.5 billion $40.9 billion Cost % to Revenue 29.8% 25.0% 23.0% Income Difference N/A $8.5 billion $3.6 billion Outcome 2 - missing goal 28% in 2010 and 25% in 2012 - analyze how this affects profit and cash flow at curren

Compliance Officer relationship with other departments

A) What are the benefits of ensuring good relationships between the Compliance Department and other departments within the business? What is likely to be the negative impact of not doing so? How do regulators in your jurisdiction view the significance of the relationship of compliance within the business unit? b) What actions

Cash Flows Growth Rate and Value of Assets

4. An interest or growth rate for a stream of cash flows can be found by first doing which of the following? a. Dividing the earliest value by the most recent value and using the table of the present value interest factors for one dollar b. Adding the earliest value by the most recent value and using the table

Finance Question

7. A decrease in a firm's ration of current liabilities to total assets _______ profitability and _____ risk, as reflected by a ______ in net working capital a. increases; increases; increase b. decreases; decreases; increase c. decreases; decreases; decrease d. increases; decreases; increase e.

Case Study Reed's Clothies

Prepare a 350-700-word case study analysis of Case #16: "Reed's Clothier" located in the Cases in Financial Management text, by Sulock and Dunkelberg. Be sure to address the following in your analysis: a. Briefly summarize the case.

Finance questions

What is inventory? What are the different types of inventory classifications? Is inventory management important? I just need the opinion on an expert in this area.

Accounting : Payback Period and Net Present Value

E23-12 Suzaki Manufacturing Company is considering three new projects, each requiring an equipment investment of $22,000. Each project will last for 3 years and produce the following cash inflows. Year AA BB CC 1 $ 7,000 $ 9,500 $13

The following are finance problems

See attached file. 1. A firm's balance sheet shows current assets of $95, net fixed assets of $250, long term debt of $40, and owners equity of $200. What is the value of the firm's current liabilities if that is the only remaining balance sheet item? 2. What is the present value of your trust fund if it promises to pay

Journalizing Transactions of Stock

Garza Co. had the following transactions during the current period. Mar. 2 Issued 5,000 shares of $1 par value common stock to attorneys in payment of a bill for $30,000 for services provided in helping the company to incorporate. June 12 Issued 60,000 shares of $1 par value common stock for cash of $375,000. July

Finance Question

Hello, I have a lot of doubt in this question. A- You are the financial manager at CYA Corp. and you are considering three different levels of working capital. You estimate that sales would decrease slightly with lowered levels of current assets and you assume that your forecasts are reasonably accurate. CYA has $35 mill

Present value, DOL, DFL, unit breakeven, contribution margin

33. Gina Dare, who wants to be a millionaire, plans to retire at the end of 40 years. Gina's plan is to invest her money by depositing into an IRA at the end of every year. What is the amount that she needs to deposit annually in order to accumulate $1,000,000? Assume that the account will earn an annual rate of 11.5%. Round off

Overview of the Investment Environment

The Capital Markets and Investment Banking Process is new & quite confusing to me. I have to write a 1100 word essay which I analyze the investment banking process. In the paper be sure to address the following: a. Describe the investment banking process including portfolio construction. b. Describe the factors

Determining Year-to-Year Percentage Growth

Answer questions 1 and 2 below based on the financial data attached. 1) Determine the year-to-year percentage annual growth in total net sales. Based only on your answers to question #1, do you think the company will hit its sales goal of +10% annual revenue growth in 2009? Determine the target revenue figure, and explain