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Step to Compute the Stock Value

Von Bora Corporation (VBC) is expected to pay a $3.00 dividend at the end of this year. If you expect VBC's dividend to grow by 6% per year forever and VBC's equity cost of capital is 12%, then the value of a share of VBS stock is closest to?

Finance IRR of Projects

See attachment 1 (chapter 5) Co. A is about to pay a dividend of $3.15 per share. Its future EPS and dividends are expected to grow with inflation, which is forecasted at 3% per year. What is the company's stock price? The nominal cost of capital is 10%. (Problem 17 page110) 2. (chapter 6) Calculate the IRR for the follow

Benchmark Corporation

Calculate the Cost of Common Stock for Benchmark Corporation given the following information: End of first year dividend is $20, the stock is selling for $27 and the dividend growth rate is 12 percent. 7. Calculate the Cost of Preferred Stock for the Reality Corporation using the following information: D p = $4 P p

Expected return and standard deviation for a portfolio

4. Asset 1 Asset 2 E(R1) = .12 E(R2) = .16 E(s1) = .04 E(s2) = .06 a. Calculate the expected return and expected standard deviation of a two stock portfolio when r1,2 = - .60 and w1 = .75. b. Calculate the expected returns and expected standard deviations of a two stock portfolio when r1,2 = .80 and w1 = .60.

Short Sale - Return on Investment

You decide to sell short 200 shares of XCorp stock at a price of $75. Your margin deposit is 65 percent. Commission on the sale is 1.25%. While you are short, the stock pays a $1.75 per share dividend. Interest on margin debt is 5.25% per year. 1. At the end of one year you close out your short position by purchasing shares

Firm Performance: Ratios and Recommendations

In millions of dollars A B C D Sales $250 $10 $15 $25 Net Income after tax 3 0.5 2.25 3 Total Assets 15 7.5 15 24 Stockholders' equity 10 5.0 14 10 How can I get total asset turnover, the net profit margin

Finance

Journal Entries for each transaction During July 2009, Krogue, Inc., completed the following transactions. entry for each transaction. July 2 Received $320,000 for 80,000 shares of capital stock. 4 Purchased $90,000 of equipment, with 75% down and 25% on a note payable. 13 Purchased $250,000 of inventory, paying 40%

Help with NASDAQ.

Hello, Could you please assist me with help on the Nasdaq? The chosen stock is Cisco Systems and stock is traded on the NASDAQ. Go to a Finance website (such as http://finance.yahoo.com/ or http://moneycentral.msn.com/ ) that gives detailed price information on your stock. NOTE: Some sites may only list ask price d

Corporate versus Proprietor

Question: You want to compare the earnings from two different legal forms for a firm: Corporate and Proprietor. Your pre-tax income is $500,000 in both. However there is a difference in the taxes you pay. 1) Corporate pays corporate tax rate of 30%. After paying corporate taxes the rest is distributed as dividends to owners.

Preferred stock vs. common stock

What would be considered preferred stock vs. common stock? I do understand the concept of how an investors' role is played in an organization when considering preferred stock and common stock. I did not realize that when it came to different types of stock investors would have a different role. I would be interested to know why

Discussing Tuition

Can someone help me in articulating this? Do you feel that the "high tuition/high aid" off-set model is a creative way of spreading the tuition burden among students or is it another example of institutional socialism? Outcome: Communicate an in-depth understanding of state, federal, and private sources of funding for high

Corporate Finance: Long Term Debt

A8. (Domestic versus Eurobond borrowing costs) A firm can issue an eight-year public debt issue at par with an 11% coupon in the domestic market. It can also issue 11.25%Eurobonds. If all other expenses are equal, which issue offers the firm the lower borrowing cost? C1. (Cost of borrowing) A firm issues a 10-year debt oblig

Finance Questions and Variable Cost of Producing Bikes

[Problem 1] A recently retired corporate executive, Mr. CEO, plans to establish the Big Bike Bicycle Company and manufacture the bikes. He estimates the fixed costs of operations to be $500,000 annually. The variable cost of producing the bikes is forecasted to be $150 per unit. (a) If the bikes are priced at $200, how man

As a financial planner a client comes to you for investment advice.

As a financial planner a client comes to you for investment advice. After meeting with him and understanding his needs, you offer him the following two investment options: Option 1 (refer to Chapter 3): Invest $5,000 in a savings account at 6.6% interest compounded monthly. Option 2 (refer to Chapter 3): Invest into an

Financial Accounting assistance

Hello, I need some assistance with the attached questions regarding my financial accounting studies. James Corp is worried about managing cash efficiently. On the average, inventories have an age of 90 days, and accounts receivable are collected in 60 days. Accounts payable are paid approximately 30 days after they arise. Th

Need assistance with financial accounting problems

Hello, The problems I need assistance understanding are attached MACRS depreciation expense and accounting cash flow Pavlovich Instruments, Inc., a maker of precision telescopes, expects to report pre-tax income of $430,000 this year. The company's financial manager is considering the timing of a purchase of new compute

Budgeting & Finance In Higher Education

Can you help me to describe the fiscal and budgetary challenges faced by higher education institutions? Outcome: Apply and analyze financial concepts and theories and the process of planning, developing, implementing, and evaluating budgets in higher education. Learning Objective: Describe the fiscal and budgetary ch

Funding Sources for Higher Education

Can someone help me in explaining how the funding of higher education can be divided up by the following main sources? ?parents ?students ?taxpayers ?philanthropists You can use personal examples to support. Is the term "nonprofit" an oxymoron? Can a business such as a university or hospital truly be nonprofit? Think

Finance

1.Dr. J. wants to buy a Dell computer which will cost $2,788 four years from today. He would like to set aside an equal amount at the end of each year in order to accumulate the amount needed. He can earn 7% annual return. How much should he set aside? A) $697.00 B) 627.93 C) $823.15 D) 531.81 2. How much must you invest

Break-even output level

Amish Enterprises makes wooden play sets. The company pays annual rent of $350,000 per year and pays administrative salaries totaling $120,000 per year. Each play set requires $300 of wood, ten hours of labor at $50 per hour, and variable overhead costs of $50. Fixed advertising expenses equal $40,000 per year. Each play set sel

MC Finance Questions

A characteristic of an efficient market is that A) prices are equal for all securities B) bid-asked spreads are large C) prices reflect all available information D) all investors receive a positive rate of return An important implication of the idea that markets are efficient is A) an investor can make money by buy

Equilibrium Stock Price

Please help with the following problem: The risk-free rate of return, rRF, is 11%; the required rate of return on the market, rM, is 14%; and Schuler Company's stock has a beta coefficient of 1.5. a) If the dividend expected during the coming year, D1, is $2.25, and if g = a constant 5%, at what price should Schuler's stoc

Return from Hedged Position

Mike Lane will have $5 million to invest in five -year U.S. Treasury bonds three months from now. Lane believes interest rates will fall during the next three months and wants to take advantage of prevailing interest rates by hedging against a decline in interest rates. Lane has sufficient bonds to pay the costs of entering into

Lear, Inc.: Alternative Financing Plans

14. Lear, Inc., has $800,000 in current assets, $350,000 of which are considered permanent current assets. In addition, the firm has $600,000 invested in fixed assets. a. Lear wishes to finance all fixed assets and half of its permanent current assets with long-term financing costing 10 percent. Short-term financing currently

The Power of Financial Analysts

Do you think financial analysts have too much power and can they really move the market on a particular stock or industry? If so, provide examples. I do not know if I would say this as an absolute. Don't they have rules by which they must abide? Regardless, I do believe they have the power to move the market on a particular s

Personal Finance for Investments in Property

IN110-0903B-14 Personal Finance Concepts Assignment Name: Unit 2 Individual Project Deliverable Length: 1-2 pages Details: Bernie and Pam Britten are a young married couple beginning careers and establishing a household. They will each make about $50,000 next year and will have accumulated about $40,000 to invest. They