QUESTION Calculating Life Expectancy. Determine the average numbers of additional years black males alive at age 35 may expect to live. The expected number of years of life remaining at a given age denoted by ex, which means the average number of subsequent years of life for someone now aged x, according to a particular […]
QUESTION If another Austin Powers movie had been released in 2007, and Dr. Evil, now armed with a financial calculator, wants to hold the Earth ransom for $7,039,988.71, what inflation rate would Dr. Evil use to make his ransom equivalent to $1 Million in 1967 (Hint: Inflation is compounded on an annual basis). Round to […]
QUESTION In 2010, Jennifer (Jen) Liu and Larry Mestas founded Jen and Larrys Frozen Yogurt Company, which was based on the idea of applying the microbrew or microbatch strategy to the production and sale of frozen yogurt. Jen and Larry began producing small quantities of unique flavors and blends in limited editions. Revenues were $600,000 […]
QUESTION Q1.)Precision Engineers Ltd. Is considering a proposal to replace one of its machines. The following data is available regarding the same: a. The machine was purchased 4 years ago for Rs.15 lacs and has been depreciated at 25% p.a. as per the WDV method. The machine has a remaining life of 5 years, after […]
QUESTION You have a cash obligation of $132,240 to be made at the end of year 5. Show how youcan use coupon bonds with a coupon rate of 8%, a face value of $1,000, a maturitydate at the end of year 6, and a yield to maturity of 8% to ensure that you can meetyour […]
QUESTION TPI is considering a $10 million debt issue with a coupon rate of 8%. Assuming that the expansion causes a cash flow increase to $8 million, calculate how this debt issue affects the debt-to-equity ratio, the EPS, dividend per share. Next, calculate the EPS and dividend per share while assuming that the expansion is […]
QUESTION You are to make monthly deposits of $500 into a retirement account that pays 10.3 percent interest compounded monthly. If your first deposit will be made one month from now, how large will your retirement account be in 35 years? Concept: Future Value of asset provides a value of an asset in the future […]
QUESTION Distinguish among the following bases of comparison: (1) intracompany, (2) industry averages, and (3) intercompany. Intra company Industry Averages Inter company 1 Comparisons that are done within a company are helpful to detect changes in financial structures and trends Comparisons with industry averages such as S&P, Moodys provide information about a companys relative positioning […]
QUESTION Comparative Ratio AnalysisUse the comparative data for Sunshine State Equipment, Inc., as given in Problem 22-42. In addition, the year-end price per share of Sunshines stock was $50 for 2006, $25 for 2007, and $35 for 2008.Instructions:1. Compute financial ratios for the three years 20062008 as follows (for ratios normally using average balances, assume […]
QUESTION Foreign Currency TranslationU.S. Multi Company established a foreign subsidiary, called For Sub Company, on January 1, 2008. The local currency is the crown; on the date the subsidiary was established, the exchange rate was 2 crowns to 1 U.S. dollar. U.S. Multi invested U.S. $6,000 to get things started. In addition, a local loan […]
