Economics/Finance

1. Which of the following would be the best investment based on present value? Assume an annual discount rate of 16% a. An investment that pays $5,000 at the end of each year for 6 years, assuming annual compounding. b. An investment that pays $1,225 at the end of each quarter for 6 years, assuming quarterly compounding c. An investment that pays $1,200 at the beginning of each quarter 6 years, assuming quarterly compounding? d. $19,000 today. e. The answer cannot be determined from the information given. Use the following data to solve questions 2, 3, 4, and 5: Year Undiscounted free cash flows 0 (380,000) 1 20,000 2 30,000 3 ... click for more

Breakeven Analysis: Product A sells for a unit price of $20. Variable costs are $8 and fixed costs are $600,000. a) Calculate the amount of sales in $ required to break even. b) Calculate the amount of sales in $ required to earn a 15% profit on costs.

Product A sells for a unit price of $20. Variable costs are $8 and fixed costs are $600,000. a) Calculate the amount of sales in $ required to break even. b) Calculate the amount of sales in $ required to earn a 15% profit on costs. Please answer both questions and list all of the steps invloved in achieving each result.

4 problems

1. Ginko Inc. has bonds outstanding that mature in 20 years. The bonds have $1000 par value, pay interest annually at a rate of 10 percent, and have a current selling price of $875.25. What is the yield to maturity? 2. A share of common stock just paid a dividend of $3.25 per share. The expected long-run growth rate for this stock is 18%. If investors require a rate of return of 24%, what should the price of the stock be? 3. Vertex bonds have a maturity value of $1000. The bonds carry a coupon rate of 14 percent. Interest is paid semi-annually. The bonds will mature in seven years. If the current market price is $1092.65, what is the yield to maturity on the bond? 4. Bangor ... click for more

Questions

Please answer the following questions with supporting evidence. 1) True/False Any business that makes a reasonable profit will always succeed. Explain your answer. 2) True/False The net worth of a company on its balance sheet is a very good measure of the real intrinsic value of the company. Explain your answer. 3) Explain the difference between fixed and variable costs and the effect of each on profitability. Which is more affected by changes in volume and why?

Shape of Population, Standard Error, Sample Mean

According to an IRS study, it takes an average of 330 minutes for taxpayers to prepare, copy, and electronically file a 1040 tax form. A consumer watchdog agency selects a random sample of 40 taxpayers and finds the standard deviation of the time to prepare, copy, and electronically file form 1040 is 80 minutes. a) What assumption or assumptions do you need to make about the shape of the population? Give assumption(s): b) What is the standard error of the mean in this example? c) What is the likelihood the sample mean is greater than 320 minutes? d) What is the likelihood the sample mean is between 320 and 350 minutes? e) What is the likelihood the sam... click for more