Explore BrainMass


Finance - Expected Return and Standard Deviation

1. You are given the following information on a stock fund. a. Please compute the expected return and standard deviation for the stock fund. Scenario Probability Rate of Return/Stock Fund Recession 25.0% -7% Normal 50% 12%

If you were the president of a large publicly owned corporation

If you were the president of a large publicly owned corporation, would you make decisions to maximize stockholders' welfare or your own personal interest? What are some actions stockholders could take to ensure that management's interests and those of the stockholders coincide?


Winston Washers stock price is $75 per share. Winston has $10 billion in total assets. Its balance sheet shows $1 billion in current liabilities, $3 billion in long-term debt, and $6 billion in common equity. It has 800 million shares of common stock outstanding. What is Winston's market/book ratio?

Cisco Systems Long-Term Growth Rate

In late 2002, analysis was forecasting fiscal 2003 and 2004 earnings per share for Cisco systems of $.54 and $.61 respectively. Cisco's shares traded at $15 at the time,. Assuming the long-term growth rate will be at 4 percent. The average rate of growth for gross national product, value Cisco using the model in equation in this

P.B. and P.E. Ratios

A firm has the following summary balance sheet and income statement (in millions): Net operating assets 469 Net financial obligations 236 Common equity 233 Operating income 70 Net financial expenses 14 Earnings 56 The firm held the same amount of net financial obligations during the whole year for which th

Discussing Financial Institution Scenarios

Select the most appropriate financial institution type for each of the following scenarios. Explain your selection and describe at least the several features of each of your selections. Scenario A A young, married, professional couple with high debt, yet also a high combined income, is looking for long-term insurance and i

Analysis of financial ratios

Financial ratio analysis is conducted by for groups of analysts: managers, equity investors, long-term creditors, and short-term creditors. What is primary emphasis of each of these groups in evaluating ratios?

EEFC: Present Worth of Cash Flows

The Engineering Economics Finance Company (EEFC) plans to receive $900,000 next year from a certain investment, with increases of 5% per year. If N = 5 years and the interest rate is 12%, determine the present worth of the cash flows. Show calculations. Please provide in both Word and Excel.

Maximum Growth Without Employing External Funds

ABC has the following ratios: A*/so=1.6, L*/so=0.4, profit margin=0.10 and dividend payout ratio=0.45. Sales last year were $100 million. Assuming the ratios remain constant, use the AFN model to determine the maximum growth rate the firm can achieve without having to employ external funds.

Corporate Risk: Planning & Insurance

What is a risk management plan? Discuss at least one component of a risk management plan and how that component relates to the effectiveness of that risk management plan.

Corporate Risk: Planning & Insurance

I have to answer the questions below in 250 words. I have been reading the chapter and don't fully understand these questions. What is valuation? Why is valuation an important tool in risk management? Explain.

Corporate Risk: Planning and Insurance

I have to answer the questions below in 250 words. I have been reading the chapter and don't fully understand these questions. What is tolerance of risk? How would you compare and contrast being risk seeking vs. risk avoidant and why is it important to make this distinction when managing risk?

Three complex Finance questions

I have three complex questions I'm having a hard time comprehending. (Problem 1) The Shrieve Corporation has $10,000 that it plans to invest in marketable securities. It is choosing among AT&T bonds, which yield 7.5%, state of Florida muni bonds, which yield 5%, and AT&T preferred stock, with a dividend yield of 6%. Shriev

Financial evaluatioin of Hasbro Inc.

I'm learning how to evaluate a firm's performance by reviewing its financial statement mostly its income statement. I need to know how to evaluate the effectiveness of working capital management, how a firm makes investment and decisions that deal with risk, and what leverage means to a firm and how it determines and appropriate

Terms in the Financial Field

Define the following terms and identify their role in finance, which means you must explain why this is important to the discipline. Do not forget to provide in-text citations and references. a. Finance b. Efficient Market c. Primary Market d. Secondary Market e. Risk f. Security g. Stock h. Bond i. Capital j. Debt

Short-Term Financing Requirements

Suppose that Paymore's cash balance at the start of the first quarter is $40 and its minimum acceptable cash balance is $30. Work out the short-term financing requirements for the firm in the coming year using a table like Table 19-6, Panel C. The firm pays no dividends.

Financial Question: Stock Return

Use the following historical data over the 1926-2000 period to answer the following question. Asset Average Return Standard Deviation Large-company stocks 13.0% 20.2% Small-company stocks 17.3% 33.4% Long term governmen

Accounting/finance questions (Tirso Company and Cobble Corporation)

Can you please help with these two questions? 2. At a volume of 20,000 direct labor hours, Tirso Company incurs $50,000 in factory overhead costs, including $10,000 in fixed costs. Assuming that this activity is within the relevant range, if volume increases to 25,000 direct labor hours, Tirso Company would expect to incur to

Break Even Point and degree of Leverage.

Healthy Foods, Inc., sells 50-pound bags of grapes to the military for $10 a bag. The fixed costs of this operation are $80,000, while the variable costs of the grapes are $.10 per pound. a. What is the break-even point in bags? b. Calculate the profit or loss on 12,000 bags and on 25,000 bags. c. What is the degree of

Rate of return: Dallas Corporation common stock

Last year Steve bought 100 shares of Dallas Corporation common stock for $53 per share. During the year he received dividends of $1.45 per share. The stock is currently selling for $50 per share. What rate of return did Steve earn over the year?

Spot and Forward Rates: Chamberlain Canadian Imports

Can you help me get started with this assignment? Chamberlain Canadian Imports has agreed to purchase 15,000 cases of Canadian beer for 4 million Canadian dollars at today's spot rate. The firm's financial manager, James Churchill, has noted the following current spot and forward rates: US dollar/Canadian dollar Canadian

Different Users of Financial Ratios

How do different users of financial ratios (bankers, investors, the company) interpret financial ratios? Which financial ratios are important to each of these users? What are some of the problems associated with using financial ratios?

Investments/common stocks

I want to use SaraLee Corporation. Choose a stock that you like- it can be any company in any industry. Then visit Yahoo Finance at http://finance.yahoo.com/?u . Once there, enter the ticker symbol for your stock in the space provided so that you can be taken to pages where you will see a comprehensive set financial informat

ESO Plan For Costco Valuation

Incorporate an ESO plan into a company's valuation. (Costco wholesale corporation). Using Costco wholesale corporation, incorporate the effect of the Employee Stock Option (ESO) plan into the common equity valuation. Be sure to consider both the forecasted ESO grants and outstanding ESOs. Perform your valuation in Excel; use