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Expected return, variance, and standard deviation

Given the data below, calculate the expected return, variance, and standard deviation of the following company. In a recessionary economy, which is expected to occur with a 30% probability, the expected returns would be -5% In an expanding economy, with an expected probability of occurrence of 20% the expected return would

How many days does the firm take to pay suppliers

Pennington's has annual sales of $1.46 million. The cost of goods sold is equal to 78 percent of sales. The firm has an average accounts receivable balance of $148,900 and an average accounts payable balance of $163,500. How many days on average does it take the firm to pay its suppliers?

What was the flotation cost as a percentage of the funds raised

High Mountain Gear issued 240,000 shares of stock last week. The underwriters charged a 7.85 percent spread in exchange for agreeing to a firm commitment. The legal and accounting fees were $385,000. The company incurred $98,000 in indirect costs related to management time and other internal expenses. The offer price was $21 a s

Henry Hawkins sold IPR stock to partnership

Henry Hawkins owns 20 percent interest in the HI Partnership. On July 1 he sold 100 shares of stock of IPR Corporation to the partnership for $10,000, its fair market value. The stock had cost him $5,000 10 months prior to the sale. How much and what character of profit must Henry report on this sale currently?

Computation of Operating and Financial Leverage

Seaside Company manufactures and sells small sailboats. Its annual sales are $3.0 million (30 sailboats at $100,000 each). Because of the need to be near the ocean, the company's fixed costs are high, $1.0 million. The variable cost ratio is 30 percent. The owner, Stan, has financed the business with $1.2 million bank loan at 7

Global Pistons: Expected Return on Stock to Buy Back Debt

Global Pistons (GP) has common stock with a market value of $200 million and debt with a value of $100 million. Investors expect a 15% return on the stock and a 6% return on the debt. Assume perfect capital markets. a. Suppose GP issues $100 of new stock to buy back the debt. What is the expected return of the stock after t

CVP Analysis

Howard Beal co. manufactures molds for casting aluminum alloy test samples. Fixed costs amount to $20,000 per year. Variable costs for each unit manufactured are $16. Sales price per unit is $28. a. What is the contribution margin of the product? b. Calculate the break-even point in unit sales and dollars. c. What

Complete table for how many public health nurses to employ

1. Suppose you are a county commissioner faced with deciding how many public health nurses to employ within the county. The following table shows total benefits and total costs from different levels of employment. Fill in the table and answer the questions: Number of public health Total

Potential financial outcome for JP Morgan Chase & Co

Write a paper in which you compare and contrast three potential financial outcomes you envision for the initiative I have everything I need except one compare and contrast. The company is JP Morgan Chase & Co. I seem to have reached a road block. Please include in text citation as well as resource information.

Exchanges and money

You just returned from some traveling thoughout the Americas. You started your trip with $20,000 in your pocket. You spent 3.4 million pesos while in Chile and 16,500 bolivares in Venezuela. Then on the way home you spent 47,500 pesos in Mexico. How many dollars did you have left by the time you returned to the US given the foll

Standard deviation for common stock of US Air Inc.

The common stock of US Air Inc. had annual returns of 15.6 %, 2.4 % , -11.8 % and 32.9% over the past 4 years respectively. What is the standard deviation of these returns.? a. 13.29 percent b. 14.14 percent c. 16.50 percent d. 17.78 percent e. 19.05 percent

Total costs per unit under the worst case scenario

Able Machinery is analyzing a proposed project. The company expects to sell 2,100 units give or take 5%. The expected variable cost per unit is $260. and the expected fixed costs are $589,000. Cost estimates are considered accurate within a plus or minus 4 % range. The depreciation expense is $129,000. The sales price is estima

Corporate Finance

1. White Wedding Corporation will pay a $3.05 per share dividend next year. The company pledges to increase its dividend by 5.25 percent per year, indefinitely. If you require an 11 percent return on your investment, how much will you pay for the company's stock today? 2. Fama's Lamas has a weighted average cost of capital of

Financial Management: Rate of return, cost of equity, expected returns, yield

6. You have the following data on three stocks shown below. You decide to use the data on these stocks to form an index, and you want to find the average earned rate of return for 2008 on your index. If you follow the averaging procedure used to calculate the S&P 500 Index return, what would your index's rate of return be? Hi

Finance: Calculate the price of perpetual preferred stock

6. Gary Wells Inc. plans to issue perpetual preferred sotck with an annual dividend of $6.50 per share. If the required return on theis preferred stock is 6.5%, at what price should the stock sell? a. $90.37 b. $92.69 c. $95.06 d. $97.50 e. $100.00

Stock price reaction

Assume that markets are efficient. During a trading day American Golf Inc, announces that it has lost a contract for a large golfing project that, prior to the news, it was widely believed to have secured. If the market is efficient, how should the stock price react to this information if no additional information is released?

Efficient Market Hypothesis: Stock profit opportunities

For each of the following scenarios, discuss whether profit opportunities exist from trading in the stock of the firm under the conditions that (1) the market is not weak form efficient, (2) the market is weak form but not semistrong form efficient, (3) the market is semistrong form but not strong form efficient, and (4) the mar

Calculate Wei's Current Stock Price

The Wei Company's last dividend was $1.75. 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?

Commodity's marginal cost

If the cost function for a commodity is: C(x)= (1/90)x^3+ 4x^2+ 4x+10 dollars Then find the marginal cost at x=3 units and tell what this predicts about the cost of producing 1 additional unit and 2 additional units. Make sure to show all steps in your work.

Compute the Net Float in Dollars

Jumpdisk Company writes checks averaging $15,000 a day, and it takes 5 days for these checks to clear. The firm also receives checks in the amount of $17,000 per day, but the firm loses three days while its receipts are being deposited and cleared. What is the firm's net float in dollars?

Select and explain a Financing Method by a VC for Phoenix Corp

See attached file. Phoenix Corp. needs $500,000 to finance its growth and it approached a venture capitalist (VC) firm to fund its future growth in business. The VC may agree to supply the funds if terms are acceptable. It asked Phoenix to provide an estimate of EBIT for the next eight years which are given below: Year

Characteristics of efficient markets

If the financial market is efficient a. stock prices should remain constant b. stock prices should increase or decrease slowly c. an increase in the value of security should be offset by a decrease d. stock prices will only change when an envent actually occurs e. stoch prices should only respond to unexpected news and e

Risk Averse Situation: Investing in an Economy

Consider the following two, completely separate, economies. The expected return and volatility of all stocks in both economies is the same. In the first economy, all stocks move together in good times all prices rise together and in bad times they all fall together. In the second economy, stock returns are independent

Interest, Annuity, Installment Loan, and Mortgage

1. Define simple interest and compound interest. Explain the difference between each. 2. Define annual percentage rate (APR). What effect does frequency of compounding have on the annual percentage yield (APY)? What condition would exist if the APR = APY? 3. What is an ordinary annuity? What is an annuity due? Which is mor

Financial Ratios for Sirius and XM Satellite Radio

IPrepare a summary comparing Sirius Satellite Radio and XM Satellite Radio's recent fiscal years statements based on the profitability ratios & efficiency levels. Discuss profitability ratios: choose 2 ratios within this category to discuss and relate to our company of choice. Discuss management efficiency ratios: choose 2