I need your help with this question its on Risk and Return and it is a True or False and I need your help explaining or qualifying the answer. a. The expected rate of return on an investment with a beta of 2 is twice as high as the expected rate of return of the market portfolio. If there are abreviations or formulas used
What are the primary weaknesses of sensitivity analysis? What are its primary advantages?
Question 4: Financial Measurements in manufacturing. The PQ Piston Plant makes two sizes of pistons for reciprocating engines. Their plant has four machines. Currently, the demand for their products is 100 'p" pistons per week:, and 50 "Q" pistons per week. The financial information for these products is as follows: Product P
This exercise involves small calcualtions on a business's finance situation and to answer short answer questions on business related terms.
Basically for this assignment you need to have knowledge of the following topics: •Capital budgeting techniques •Use of discounting tables •Types of risk – Business risk, break even and financial risk •Sources of finance •Portfolio theory •Portfolio standard deviation The actu
Can you help me with this problem: Cain Auto Supplies and Able Auto Parts are competitors in the aftermarket for auto supplies. The seperate capital structures for Cain and Able are presented below: Cain Debt @10%...............$50,000 Common Stock, $10 par.....100,000 Total................................$150,000 C
Can you help me with the following problem: The Harding company manufactures skates. The company's income statement for 2001 is as follows: HARDING COMPANY Income statement For the Year Ended December 31, 2001 Sales (10,000 skates @$50 each).....................
I need help finding the answers to the questions attached, the class is Operating and Financial leverage
I need your help finding the answer to the folloing problems: Shock Electronics sells portable heaters for $25 per unit, and the variable cost to produce them is $17. Mr. Amps estimates that the fixed costs are $96,000. a.) How do I compute the break-even point in units? b.) How do I fill in the table below (in
Which of the following is not a direct result of a stock dividend? a. the number of shares outstanding is increased b. the market share of each outstanding share is increased c. the amounts shown in the firm's capital accounts are redistributed d. a and b
I need help finding the answers to the follwing: How do I describe the importance of internal control programs, and how do I identify effective internal control techniques? How can I Illustrate the relationship between ethics and internal control techniques, and how do I describe the importance of the Sarbanes-Oxley Act? I do
A decrease in the debt ratio will normally have no effect on a. Financial risk b. Total risk c. Business risk d. Systematic risk e. Firm-unique risk.
In theory the decision maker should view market risk as being of primary importance. However, within-firm, or corporate, risk is relevant to a firm's a. Well diversified stockholders, because it may affect debt capacity and operating income. b. Management, because it affects job stability. c. Creditors, because it a
You are considering the purchase of an investment that would pay you $5,000 per year for years 1-5, $3,000 per year for years 6-8, and $2,000 per year for years 9 and 10. If you require a 14 percent rate of return, and the cash flows occur at the end of each year, then how much should you be willing to pay for this investment?
Allegheny Publishing's stock is expected to pay a year-end dividend, D1, of $4.00. The dividend is expected to grow at a constant rate of 8 percent per year, and the stock's required rate of return is 12 percent. Given this information, what is the expected price of the stock, eight years from now? a. $200.00 b. $185.09
Stock X has a required return of 12 percent, a dividend yield of 5 percent, and its dividend will grow at a constant rate forever. Stock Y has a required return of 10 percent, a dividend yield of 3 percent, and its dividend will grow at a constant rate forever. Both stocks currently sell for $25 per share. Which of the following
The DMT Company is financed entirely with equity. DMT has a beta of 1.20 and the current risk-free rate of 9.5%. If the expected market return (Km)is 14%, what rate of return should DMT require on a project of average risk? [ke=krf + (km-krf)(B)] The following choices are one of the answers: a. 14.9% b. 15.4% c. 14.0% d.
What is the net investment for an extruder that costs $42,000, if shipping costs are $1,500 and installation is $4,800? Assume this efficient machine is replacing an older extruder with a book and market value of zero. The replacement investment will reduce operating costs by $6,600 a year. The following choice are: a. $48,
ABC Hospital laundry department cleans laboratory jackets for the housekeeping and laboratory departments. The budgeted volume of jackets was 100 for housekeeping and 200 for laboratory. Housekeeping actually used 100, but laboratory used only 150. Fixed costs for the laundry were budgeted at $150. Variable costs were budgete
Needs to be done on excel spreadsheet. Please be as explicit as possible. Thanks 1. Supernormal Growth. Finley Co. is growing quickly. Dividends are expected to grow at 25 percent rate for the next three years, with a growth rate falling off to a constant 6 percent thereafter. If the required rate of return is 14 percent and
3. Consider two securities with expected return of 16% and 20% and standard deviation of 25% and 40%, respectively. a. If the returns of the two assets are perfectly correlated, create a portfolio with an expected return of 24%. Find the standard deviation of that portfolio. b. Create a portfolio with a standard deviation o
Clarion contractors completed the following transactions and events Jan 1 paid 255440 cash plus 15200 in sales tax and 2500 in transportation fees for a new loader. Loader has a four year life and a 34740 salvage value. Loader costs are recorded in the equipment account. Jan 3 Paid 3660 to enclose the cab and install air
In January of 2005 Keona Co pays 2800000 for a tract of land with two buildings on it. it plans to demolish building one and build a new store. Building two will be a company office it is appraised at 641300 with a usefull life of 20 years and an 80000 salvage value. Without the buildings and improvements the tract of land is
Axel Telecommunications has a target capital structure that consists of 70 percent debt and 30 percent equity.
Axel Telecommunications has a target capital structure that consists of 70 percent debt and 30 percent equity. The company anticipates that its capital budget for the upcoming year will be $3,000,000. If Axel reports net income of $2,000,000 and it follows a residual distribution model with all distributions as dividends, what w
A firm has the following balance sheet: Cash $20 Accounts receivable $20 Inventory $20 Common stock $80 Accounts payable $20 Notes payable $40 Long-term debt $80 Fixed assets $180 Total assets $240 Retained earnings $20 Total liabilities and equity $240 Sales fo
Napa Auto Parts' last dividend (t=0) was $1.00 and the company expects to experience no growth for the next 3 years (from t=0 - t=3). However, Napa will grow at an annual rate of 10% between the third and fourth year and between the fourth and fifth years. Starting from the end of the fifth year, Napa will grow at a 5% rate, t
CASE STUDY - PART 3 JKD Memorial Hospital The first quarter is now complete and your boss has asked you to perform a variance analysis of the Nursing Department at JKD Memorial. As you may recall, the quarterly departmental budget for nursing was as follows:... In addition, it was assumed that there would be a total of
A stock's return has the following distributions: Demand for the Probability of Rate of Return Company's This Demand If This Products Occuring Demand Occurs Weak 0.1 (50%) Below Average 0.2 (5) Average
Short Answer 1. What is the difference between stock price maximization and profit maximization? Under what conditions might profit maximization not lead to stock price maximization? 2. Assume that you are serving on the board of directors of a medium-sized corporation and that you are responsible for establishing the com
A large consulting firm orders photocopying paper by the carton. The firm pays $30 delivery charge on each order. The total cost of storing the paper, including forgone interest, storage space, and deterioration, comes to about $1.50 per carton per month. The firm uses 1,000 cartons of paper per month. See attached for fur
A husband and wife contribute $4,000 per year to an IRA paying 10%, compounded annually, for twenty years. What is the value of their IRA? How much can they withdraw each year for 25 years at 10% compounded annually?
Profitability Measures; Liquidity Measures; Activity Measures; Financial Leverage Measures; Physical Measures
Required: a. Compute the following profitability measures for the year ended December 29, 2001: 1. Return on investment, based on net income (perform a DuPont analysis). 2. Return on equity, based on net income. 3. Price/earnings ratio. Use $32.24 as the year-end market price. 4. Dividend yield. 5. Dividend payout rat