Please explain what an ETF is? Why are ETFs increasingly becoming a staple of investment portfolios? and How are they? Please discuss in detail Provide at least 1 reference
1. The stock valuation approach uses discounted cash flows concepts to calculate the theoretical value of a stock. The most popular academic approach is the dividend growth model. If a stock does not pay a dividend, this model cannot be used. What might be an alternative method or approach to valuing a stock if it does no
Karen's portfolio which has a beta of 1.02, consists of three mutual funds: an international fund, a utility fund, and a technology fund. The international fund has a beta of 1.5 and makes up to 20% of the portfolio. The utility fund has a beta of 05, and the technology fund has a beta of 1.3, If the portfolio's beta equals 1.02
It is often said that money markets are not used to get rich, but to avoid being poor. Do you agree or disagree with this statement? Provide support for your opinion. Which markets do you prefer? Explain why.
Recently there have been large shifts in the prices of stocks in the stock market. What do you think makes the prices of a firms stock change so much? Include proof of your opinion.
Susan Meyer, owner/manager of Meyer's Motor Court in Key West, is considering outsourcing the daily room cleanup for her motel to Duffy's Maid Service. Susan rents an average of 50 rooms for each of the 365 nights (365*50 equals the total rooms rented for the year). Susan's cost to clean a room is $12.50. The Duffy's Maid Servic
Could you please help me with this question?: When corporations raise funds, what type of financing vehicle (instrument or instruments) is most favored?
In answering the following questions, it is given that the potential investment has the following range of possible outcomes and probabilities: 10% probability of a -20% return, 40% probability of a 15% return, 40% probability of a 25% return, and a 10% probability of a 50% return. (a) Calculate the weighted mean of the proba
Consider a GNMA mortgage pool with principal of $20 million. The maturity is 30 years with a monthly mortgage payment of 10 percent per annum. Assume no prepayments. a. What is the monthly mortgage payment (100 percent amortizing) on the pool of mortgages? b. If the GNMA insurance fee is 6 basis points and the servicing fee
If the inflation rate in the United States is greater than the inflation rate in Britain, other things held constant, the British pound will:
1) If the inflation rate in the United States is greater than the inflation rate in Britain, other things held constant, the British pound will: -Appreciate against the U.S. dollar. -Depreciate against the U.S. dollar. -Remain unchanged against the U.S. dollar. -Appreciate against other major currencies. -Appreciate aga
You plan to purchase a $ 175,000 house using a 15- year mortgage obtained from your local bank. The mortgage rate offered to you is 7.75 percent. You will make a down pay-ment of 20 percent of the purchase price. a. Calculate your monthly payments on this mortgage. b. Calculate the amount of interest and, separately, princi-pal
5) Taggart Technologies is considering issuing new common stock and using the proceeds to reduce its outstanding debt. The stock issue would have no effect on total assets, the interest rate Taggart pays, EBIT, or the tax rate. What is likely to occur if the company goes ahead with the stock issue?
Bunyan Lumber, LLC, harvests timber and delivers logs to timber mills for sale. The company was founded 70 years ago by Pete Bunyan. The current CEO is Paula Bunyan, the granddaughter of the founder. The company is currently evaluating a 7,500 acre forest it owns in Oregon. Paula has asked Steve Boles, the company's finance offi
The Wei Company's last dividend was $1.65. The dividend growth rate is expected to be constant at 1.50% for 2 years, after which dividends are expected to grow at a rate of 8.00% forever. Wei's required return (rs) is 12.00%. What is Wei's current stock price?
Before approving a loan to a small business, the banker must be satisfied with the owner's character. Why is this? Do you agree or disagree? Support your post material from an outside source or personal experience.
See attached files. Review the following five applications. They are all for primary residential, 30-year mortgages, with full documentation. Be sure that before you decide which applications to approve, you consult the Lending Policies Manual. Your goal is to give the bank the greatest possible gain. Choose the loan(s)
According to prospect theory, which is preferred? 1. Prospect A or B Decision (i) Choose between A. (.80, $50, $0) B. (.4, $100, $0) 2. Prospect C or D? Decision (ii) Choose between: C. (.00002, $500,000, $0) and D. (.00001, $1,000,000, $0) 3. Are these choices consistent with expected utility
Read the article and answer two questions http://www.cfo.com/article.cfm/14502539?f=most_read 1. Do the pressures of living up to analyst's expectations encourage fraudulent financial reporting? 2. What are your thoughts on the guilt/innocence of the Diebold executives when the two different CFOs are accused and the
What is a banker's acceptance? How are they initiated? Why are they desirable for the exporter?
Micro Brewery borrows $300,000 to be paid off in three years. The loan payments are semiannual with the first payment due in six months, and interest is at 6%. What is the amount of each payment? a. $55,379 b. $106,059 c. $30,138 d. $60,276
Problem 1 Objectives: Calculate the total cost of a loan. Task: Respond to each of the scenarios below. Compute the answer showing your work. Context: 1. You are considering buying a used piano. The cash price of the piano is $600. The company selling the piano is willing to sell it to you for $50 down plus 12 mo
Travel history analysis is important in forecasting future needs. What role does the City-Pair-Analysis chart and graph play in this inquiry?
Some people have suggested that a credit crisis in the financial market indirectly alleviates inefficiency in financial institutions' operations. What could be the influence? Describe how the credit crisis causes this to occur. Suggest at least two proactive steps that financial institutions may take to provide the same influenc
Evaluate the benefits and limitations of portfolio diversification. Discuss how risk is assessed and what methods are most appropriate for measuring systematic and unsystematic risks. What are the best ways to diversify a portfolio? Please provide your team's rationale for their opinions from this week's readings.
Please see attached file for proper format. John Marshall is employed as a bank loan officer for CityBank. He is comparing two companies that have applied for loans and he wants your help in evaluating those companies. The two companies - Morris Company and Walker Company - are approximately the same size and had a
See the attached file. FIN/366 Weekly Overview WEEK THREE: ASSESSING AND MANAGING RISK Objectives for the Week • Describe types of risks facing financial institutions. • Analyze the methods used to measure financial interest risk. • Determine the differences between interest rates and interest income. What You
Explain why investors demand higher expected rates of return on stocks with more variable rates of return.
1. The futures markets have potentially unlimited risk for the speculators. If a speculator guesses wrong about the price direction of a commodity, then he or she can incur unlimited losses. When they open a futures account, speculators give their brokers access to all of their assets (to cover losses). Hedge funds use future
** Please see the attached file for the complete problem description ** Consider the following income statement for WatchoverU Savings Inc. (in millions) (see attached). a. What is WatchoverU's expected net interest income at year-end? b. What will be the net interest income at year-end if interest rates rise by 2 perce
The following is ABC Inc.'s balance sheet (in thousands) (see attached). Also assume that sales equal $500, cost of goods sold equals $360, interest payments equal $62, taxes equal $56, and net income equals $22. Assume the beginning retained earnings is $0, the market value of equity is equal to its book value, and the com