Question 1
Please, i need this within an hour.,Here it is,Question 1 Question 4 Which of the following risk types can be diversified by adding stocks to a portfolio? Answer Systematic Risk. Default risk. Non diversifiable risks. Unique risks. Market Risk. 1 points Question 5 Firms that make investment decisions based upon the payback rule may be biased towards rejecting projects: Answer with early cash inflows. With short lives. With long lives. Those with negative NPVs. None of above. 1 points Question 6 When a project's internal rate of return equals its opportunity cost of capital, then: Answer The net present value will be negative. The net present value is a linear combination of MIRR and IRR. The net present value will be positive. The project has no cash inflows. The net present value will be zero. 1 points Question 7 When hard rationing exists, projects may be evaluated by the use of ? Answer Payback period. borrowing rather than lending projects. Modified payback period. A profitability index. MIRR. 1 points Question 8 Because of its age, your car costs $3000 annually in maintenence expense. You could replace it with a newer vehicle costing $6000. Both vehicles would be expected to last 4 more years. If your opportunity cost is 10% what should be the maximum annual maintenance expense be on the newer vehicle to justify the purchase ? (Hint : EAC on the new vehicle should not exceed $3000) Answer $1250.34. $1107.18. $1893.88. $3000.00. $1415.51. 1 points Question 9 Taggart Inc.'s stock has a 50% chance of producing a 25% return, a 30% chance of producing a 10% return, and a 20% chance of producing a -28% return. What is the firm's expected rate of return? Answer 8.71% 9.90% 10.20% 10.30% 9.31% 1 points Question 10 Tom O'Brien has a 2-stock portfolio with a total value of $100,000. $35,000 is invested in Stock A with a beta of 0.75 and the remainder is invested in Stock B with a beta of 1.42. What is his portfolio's beta? Answer 1.19 1.08 1.32 1.20 1.01 1 points Question 11 Assume that you hold a well-diversified portfolio that has an expected return of 11.0% and a beta of 1.20. You are in the process of buying 1,000 shares of Alpha Corp at $10 a share and adding it to your portfolio. Alpha has an expected return of 19.0% and a beta of 1.80. The total value of your current portfolio is $90,000. What will the expected return and beta on the portfolio be after the purchase of the Alpha stock? Answer 14.04% and 1.21 11.80% and 1.26 12.86% and 1.40 12.04% and 1.23 12.15% and 0.97 1 points Question 12 Cooley Company's stock has a beta of 1.20, the risk-free rate is 2.25%, and the market risk premium is 5.50%. What is the firm's required rate of return? Answer 9.38% 7.35% 6.73% 7.88% 8.85% 1 points Question 13 Roenfeld Corp believes the following probability distribution exists for its stock. What is the coefficient of variation on the company's stock? State of the Economy Probability of State Occurring Stock's Expected Return Boom 0.29 25% Normal 0.50 15% Recession 0.21 5% Answer 0.4447 0.5114 0.4891 0.4002 0.3335 1 points Question 14 You hold a diversified $100,000 portfolio consisting of 20 stocks with $5,000 invested in each. The portfolio's beta is 1.12. You plan to sell a stock with b = 0.90 and use the proceeds to buy a new stock with b = 2.25. What will the portfolio's new beta be? Answer 1.188 1.021 1.140 1.401 1.199 1 points Question 15 Returns for the Dayton Company over the last 3 years are shown below. What's the standard deviation of the firm's returns? (Hint: This is a sample, not a complete population, so the sample standard deviation formula should be used.) Year Return 2011 21.00% 2010 -12.50% 2009 17.50% Answer 14.18% 18.41% 17.49% 20.99% 17.31% 1 points Question 16 A stock is expected to pay a dividend of $0.75 at the end of the year. The required rate of return is r = 10.5%, and the expected constant growth rate is g = 2.8%. What is the stock's current price? Answer $11.20 $11.88 $11.10 $12.08 $9.74 1 points Question 17 If D = $2.25, g (which is constant) = 3.5%, and P = $60, what is the stock's expected dividend yield for the coming year? Answer 3.80% 4.08% 4.58% 4.50% 3.88% 1 points Question 18 Bay Manufacturing is expected to pay a dividend of $1.25 per share at the end of the year (D = $1.25). The stock sells for $21.50 per share, and its required rate of return is 10.5%. The dividend is expected to grow at some constant rate, g, forever. What is the equilibrium expected growth rate? Answer 5.34% 4.69% 5.44% 5.86% 5.01% 1 points Question 19 Molen Inc. has an outstanding issue of perpetual preferred stock with an annual dividend of $3.50 per share. If the required return on this preferred stock is 6.5%, at what price should the stock sell? Answer $45.77 $44.69 $59.77 $53.85 $53.31 1 points Question 20 The Francis Company is expected to pay a dividend of D = $1.25 per share at the end of the year, and that dividend is expected to grow at a constant rate of 6.00% per year in the future. The company's beta is 1.35, the market risk premium is 5.50%, and the risk-free rate is 4.00%. What is the company's current stock price? Answer $18.20 $28.80 $19.82 $20.97 $23.04 1 points Question 21 Nachman Industries just paid a dividend of D0 = $4.25. Analysts expect the company's dividend to grow by 30% this year, by 10% in Year 2, and at a constant rate of 5% in Year 3 and thereafter. The required return on this low-risk stock is 9.00%. What is the best estimate of the stock's current market value? Answer $147.35 $144.46 $127.13 $119.90 $153.13 1 points Question 22 A company's perpetual preferred stock currently sells for $125.00 per share, and it pays an $8.00 annual dividend. If the company were to sell a new preferred issue, it would incur a flotation cost of 5.00% of the issue price. What is the firm's cost of preferred stock? Answer 5.12% 5.46% 7.28% 6.74% 7.61% 1 points Question 23 You were hired as a consultant to Giambono Company, whose target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 6.00%, the cost of preferred is 7.50%, and the cost of retained earnings is 11.50%. The firm will not be issuing any new stock. What is its WACC? Answer 10.53% 8.70% 7.48% 8.44% 6.87% 1 points Question 24 Anderson Systems is considering a project that has the following cash flow and WACC data. What is the project's NPV? Note that if a project's projected NPV is negative, it should be rejected. WACC: 11.75% Year 0 1 2 3 Cash flows -$1,000 $500 $500 $500 Answer $206.09 $216.40 $179.30 $199.91 $204.03 1 points Question 25 Daves Inc. recently hired you as a consultant to estimate the company's WACC. You have obtained the following information. (1) The firm's noncallable bonds mature in 20 years, have an 8.00% annual coupon, a par value of $1,000, and a market price of $1,250.00. (2) The company's tax rate is 40%. (3) The risk-free rate is 4.50%, the market risk premium is 5.50%, and the stock's beta is 1.20. (4) The target capital structure consists of 35% debt and the balance is common equity. The firm uses the CAPM to estimate the cost of equity, and it does not expect to issue any new common stock. What is its WACC? Answer 8.27% 9.46% 8.44% 8.19% 7.94% 1 points Question 26 Warr Company is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's projected IRR can be less than the WACC or negative, in both cases it will be rejected. Year 0 1 2 3 4 Cash flows -$1,150 $400 $400 $400 $400 Answer 3.26% 3.21% 2.40% 2.63% 3.19% 1 points Question 27 Taggart Inc. is considering a project that has the following cash flow data. What is the project's payback? Year 0 1 2 3 Cash flows -$1,300 $500 $500 $500 Answer 3.15 years 2.29 years 2.05 years 2.83 years 2.60 years 1 points Question 28 Ehrmann Data Systems is considering a project that has the following cash flow and WACC data. What is the project's MIRR? Note that a project's projected MIRR can be less than the WACC (and even negative), in which case it will be rejected. WACC: 10.75% Year 0 1 2 3 Cash flows -$1,000 $450 $450 $450 Answer 10.86% 14.48% 15.49% 15.20% 12.45% 1 points Question 29 Fernando Designs is considering a project that has the following cash flow and WACC data. What is the project's discounted payback? WACC: 10.00% Year 0 1 2 3 Cash flows -$625 $500 $500 $500 Answer 1.30years 1.41 years 1.58years 1.09years 1.07years 1 points Question 30 Francis Inc.'s stock has a required rate of return of 10.25%, and it sells for $60.00 per share. The dividend is expected to grow at a constant rate of 6.00% per year. What is the expected year-end dividend, D ? Answer $2.55 $1.91 $3.19 $2.68 $2.17,Its past due now. Nevermind
Question 2
(PLEASE SEE ATTACHED DOCUMENT) Problem 13-5A Suppose selected financial data of Target and Wal-Mart for 2014 are presented here (in millions). Target Corporation Wal-Mart Stores, Inc. Income Statement Data for Year Net sales $65,380 $415,836 Cost of goods sold 44,999 300,351 Selling and administrative expenses 14,927 77,202 Interest expense 690 1,949 Other income (expense) (76 ) (383 ) Income tax expense 1,360 7,222 Net income $ 3,328 $ 28,729 Balance Sheet Data (End of Year) Current assets $16,174 $47,571 Noncurrent assets 26,924 122,948 Total assets $43,098 $170,519 Current liabilities $10,720 $54,168 Long-term debt 18,375 43,168 Total stockholders? equity 14,003 73,183 Total liabilities and stockholders? equity $43,098 $170,519 Beginning-of-Year Balances Total assets $44,276 $162,550 Total stockholders? equity 13,595 64,266 Current liabilities 10,191 54,755 Total liabilities 30,681 98,284 Other Data Average net accounts receivable $7,789 $4,140 Average inventory 7,110 33,407 Net cash provided by operating activities 5,929 25,981 Capital expenditures 1,785 12,376 Dividends 482 3,988 (a) For each company, compute the following ratios. (Round all answers to 2 decimal places, e.g. 1.83 or 12.61%.) Target Wal-Mart (1) Current ratio. :1 :1 (2) Accounts receivable turnover. times times (3) Average collection period. days days (4) Inventory turnover. times times (5) Days in inventory. days days (6) Profit margin. % % (7) Asset turnover. times times (8) Return on assets. % % (9) Return on common stockholders? equity. % % (10) Debt to assets ratio. % % (11) Times interest earned. times times (12) Current cash debt coverage. times times (13) Cash debt coverage. times times (14) Free cash flow. $ $ Don't show me this message again for the assignment Click if you would like to Show Work for this question: Open Show Work
Question 3
"P11-6B The post-closing trial balance of Chen Corporation at December 31, 2011, contains the following stockholders? equity accounts. Preferred Stock (15,000 shares issued) $ 750,000 Common Stock (250,000 shares issued) 2,500,000 Paid-in Capital in Excess of Par Value?Preferred 250,000 Paid-in Capital in Excess of Par Value?Common 400,000 Common Stock Dividends Distributable 250,000 Retained Earnings 902,000 A review of the accounting records reveals the following. 1. No errors have been made in recording 2011 transactions or in preparing the closing entry for net income. 2. Preferred stock is $50 par, 8%, and cumulative; 15,000 shares have been outstanding since January 1, 2010. 3. Authorized stock is 20,000 shares of preferred, 500,000 shares of common with a $10 par value. 4. The January 1 balance in Retained Earnings was $1,170,000. 5. On July 1, 20,000 shares of common stock were sold for cash at $16 per share. 6. On September 1, the company discovered an understatement error of $90,000 in computing depreciation in 2010. The net of tax effect of $63,000 was properly debited directly to Retained Earnings. 7. A cash dividend of $250,000 was declared and properly allocated to preferred and common stock on October 1. No dividends were paid to preferred stockholders in 2010. 8. On December 31, a 10% common stock dividend was declared out of retained earnings on common stock when the market price per share was $18. 9. Net income for the year was $495,000. 10. On December 31, 2011, the directors authorized disclosure of a $200,000 restriction of retained earnings for plant expansion. (Use Note X.) Instructions (a) Reproduce the Retained Earnings account for the year. (b) Prepare a retained earnings statement for the year. (c) Prepare a stockholders? equity section at December 31. (d) Compute the earnings per share of common stock using 240,000 as the weighted-average shares outstanding for the year. (e) Compute the allocation of the cash dividend to preferred and common stock.
Question 4
From the end of Chapter 9, complete Study Problem 9-9 and post the answers to the discussion board. Remember to complete all parts of the problems and report the results of your analysis. Do not forget to show the necessary steps and explain how your attained that outcome. 9-9 (Cost of debt) Sincere Stationery Corporation needs to raise $500,000 to improve its manufacturing plant. It has decided to issue a $1,000 par value bond with a 14% annual coupon rate and a 10-year maturity. The investors require a 9% rate of return. a. Compute the market value of the bonds. b. What will the net price be if flotation costs are 10.5% of the market price? c. How many bonds will the firm have to issue to receive the needed funds? d. What is the firm?s after-tax cost of debt if its average tax rate is 25% and its marginal tax rate is 34%?,if i may ask if you can please show how you got the answer I think I will be okay on this one thnk you so much for all the work.,If you can and if you have them can you please send them i am sorry and don't mean to be a pain...... Remember to complete all parts of the problems and report the results of your analysis. Do not forget to show the necessary steps and explain how your attained that outcome.
Question 5
The second part of the project, requires you to identify a significant problem in your organization?s current environment/strategy, based on your performance evaluation from Part 1 of the project. 1. Begin with a brief introduction to the environment from which your organization?s problem has developed. Essentially, you are providing a background or context for the reader to properly understand the problem that your organization is facing 2. Identify a significant problem in your organization?s current environment and/or strategy, based on the performance evaluation from Part 1 of the project. Discuss how this problem is affecting both the organization and the organization?s stakeholders (employees, shareholders, community, environment, etc.). Be sure to provide appropriate financial and/or nonfinancial measures to support the validity of this problem. 3. Determine at least 3 potential solutions (decision alternatives) to the organizational problem that you have identified. Discuss each solution, and the potential effects it could have on the organization and its stakeholders. 4. Graphically express the decision alternatives in a The first three items above should be covered in 4-5 double-spaced pages. Include the payoff table and decision tree after these pages (the graphics do NOT count towards the 4-5 pages). Refrain from making any recommendations for the organization at this stage. You will be doing that in Part 3 of the project. At this stage, simply identify the problem and the available decision alternatives. Again, be sure to proofread as this project will be evaluated both for content and professionalism.,Hello, Every thing looks great with the assignment except you did not do the graph for the payoff table and decision tree. thanks Student
