QUESTION You have been given the following projections for Cali Corporation for the coming year. Sales = 10,000 units. Sales price per unit = $10. Variable cost per unit = $5. Fixed costs = $10,000. Bonds outstanding = $15,000. rd on outstanding bonds = 8%. Ta Sales = 10,000 units Sales price per unit = […]
Date: September 2nd, 2020
QUESTION 1. Suppose the September CBOT Treasury bond futures contract has a quoted price of 89-09. What is the implied annual interest rate inherent in this futures contract?2. Suppose the December CBOT Treasury bond futures contract has a quoted price of 80-07. If annual interest rates go up by 1.00 percent 1. Suppose the September […]
Date: September 2nd, 2020
QUESTION Which of the following statements is CORRECT?a. Since debt capital can cause a company to go bankrupt but equity capital cannot, debt is riskier than equity, and thus the after-tax cost of debt is always greater than the cost of equity.b. The tax-adjusted cost of debt is always greater than the Option C is […]
Date: September 2nd, 2020
QUESTION solve pleaseExpected returnsStocks X and Y have the following probability distributions of expected future returns:Probability X Y0.1 -15% -22%0.2 3 00.3 15 180.2 21 260.2 31 361.Calculate the expected rate of return, rY, for Stock Y (rX = 14.00%.) Round your answer to two decimal p 1.Calculate the expected rate of return, rY, for […]
Date: September 2nd, 2020
QUESTION If someone could show me exactly how to work these out step by step that would be great!!!!!A.) Dividend valuation model for new public issue. The investment banking firm of Einstein & Co. will use a dividend valuation model to appraise the shares of the Modern Physics Corporation. Dividents (D1 a)i) Price of the […]
Date: September 2nd, 2020
QUESTION 40. The value of a negative beta asset is____A) The higher expected return of this assetB) Non-existent because negative beta assets are theoretically impossibleC) The risk reducing property when added to a portfolioD) That it is a necessary component to have a fully diversified portfolioE) 40. The value of a negative beta asset is […]
Date: September 2nd, 2020
QUESTION . XYZ stock is selling for $100 per share. Call options on XYZ with a strike price of $100 are selling at $5 per share. John invests $1,000 by buying 10 shares of XYZ. Pat invests $1,000 by buying 200 call options on XYZ (with a strike price of $100) and holds the options […]
Date: September 2nd, 2020
QUESTION 1. Discuss the use of multiples as a means of estimating value and describe the process for applying multiples.2. Explain how companies with substandard financial history can draw the attention of investors. Are investors irrational or naieve?3. Explain how a growing company can starve itself to dea Identification A market multiples analysis can compare […]
Date: September 2nd, 2020
QUESTION What is the role provided by break-even point and how would you calculate this point?What are the limitations of using break-even point and how would you incorporate this point with management strategic planning Introduction: Break- even analysis is a generally neglected credit risk assessment to ol. It is very useful in leaping proposal the […]
Date: September 2nd, 2020
QUESTION A firm is considering two mutually exclusive projects, X and Y, with the following cash flows:.0.1..2.34Project X.-$1,000..$100$280..$370.$700Project Y.-$1,000..$1,100$110$50..$55The projects are equally risky, and their WACC The Modified Internal Rate of Return (MIRR) is a financial measure to find out the attractiveness of the investment. It is used in capital budgeting to rank alternative investments […]
Date: September 2nd, 2020
