1.1 (a) If you deposit $2,750 in the bank today, what is its future value at the end of six years if it is invested in an account paying 5.6% annual interest, (assuming annual compounding)?(b) What is the present value of $2,750 to be received in six years if the appropriate interest rate is 5.6% (annual compounding)?1.2 We sometimes need to find how long it will take a sum of money (or anything else) to grow to some specified amount. (a) For example, if a company’s sales are growing at a rate of 5.6% per year, approximately how long will it take sales to triple? Show your answer to 2 decimals (x.xx years) (b) If you want an investment to double in 6 years, what interest rate must it earn? Show your answer to 2 decimals (x.xx%)

You have accumulated some money for your retirement. You are going to withdraw $62,749 every year at the end of

You have accumulated some money for your retirement. You are going to withdraw $62,749 every year at the end of the year for the next 16 years. How much money have you accumulated for your retirement? Your account pays you 13.92 percent per year, compounded annually. To answer this question, you have to find the present value of these cash flows.Round the answer to two decimal places.

Which one of the following is TRUE?Select one: a. For tax, legal and accounting purposes, preference shares are treated as

Which one of the following is TRUE?Select one: a. For tax, legal and accounting purposes, preference shares are treated as equity.b. Preference shareholders stand behind ordinary shareholders in line for dividends.c. Like debtholders, preference shareholders can force a firm into bankruptcy.d. The previously unpaid dividends for non-cumulative preference shares cannot be skipped.Clear my choiceQuestion 11An annuity pays $12 per year for 100 years. What is the future value of this annuity at the end of those 100 years, given that the discount rate is 6%?Select one:a. $67,660.42b. $148,579.94c. $329,814.19d. $199.41Clear my choiceQuestion 12A linear regression was done to estimate the relation between Santos’ share returns and the market’s return. The intercept of the line was found to be 0.23 and the slope was 1.27. Which of the following statements is TRUE regarding Santos shares?Select one:a. The standard deviation of Santos’ excess returns is 23%.b. Santos’ beta is 0.23.c. Santos’ beta is 1.27.d. The risk-free rate is 1.27%.

You expect Wesfarmers (WES) to have a beta of 0.9 over the next year and the beta of Qantas (QAN)

You expect Wesfarmers (WES) to have a beta of 0.9 over the next year and the beta of Qantas (QAN) to be 1.1 over the next year. Also, you expect the standard deviation of WES to be 35% and that of QAN to be 50% over the next year. Which company has more systematic risk? Which company has more total risk?Select one:a. WES, WESb. WES, QANc. QAN, WESd. QAN, QANClear my choiceQuestion 17Harry only has $690 today but needs $800 to buy a new laptop. How long will he have to wait to buy the laptop if he earns 3.7% per annum on his investment?Select one:a. 3.36 yearsb. 2.81 yearsc. 4.07 yearsd. 3.03 yearsClear my choiceQuestion 18GIA Ltd just paid a dividend of $1.80 per share. The company’s dividend is expected to grow by 20% in the first year and 15% in the second year. From Year 3 onwards, the dividend is expected to grow at a constant rate of 5% forever. The required rate of return is 12%. What is the current price of the company share?Select one:a. $29.7b. $30.43c. $33.61d. $37.26

Consider a two-stock portfolio containing Securities A and B. A has the expected return of 10% with standard deviation of

Finance Assignment Writing ServiceConsider a two-stock portfolio containing Securities A and B. A has the expected return of 10% with standard deviation of 3% while B has the expected return of 20% with standard deviation of 5%. The weights for A and B are 60% and 40% respectively. The correlation coefficient between A and B is -0.3. Calculate the expected return (E(R)) and standard deviation (SD) of the above portfolio.Select one:a. E(R)=0.14, SD=0.038b. E(R)=0.16, SD=0.000508c. E(R)=0.14, SD=0.0225d. E(R)=0.14, SD=0.000508Clear my choiceQuestion 20Which one of the following is FALSE?Select one:a. Resignation of a firm’s chief financial officer is a source of unsystematic risk.b. The risk premium of a share is not affected by unsystematic risk.c. A maximum reduction in portfolio risk occurs when the correlation coefficient between the two stocks is equal to minus one.d. Beta is a measure of unsystematic risk.Clear my choiceQuestion 21Two years ago, you purchased a new car. You financed your car for 60 months (with payments made at the end of the month) with a loan at 6.1% APR. Your monthly payments are $640.15 and you have just made your 24th monthly payment on your car. Assuming that you have made all of the first 24 payments on time, then the outstanding principal balance on your car loan today is closest to:Select one:a. 32,271b. 20,496c. 33,033d. 21,011

Which one of the following is FALSE?Select one: a. If interest rates are the same, more frequent compounding is favourable

Which one of the following is FALSE?Select one: a. If interest rates are the same, more frequent compounding is favourable for investors but not good for borrowers.b. Financial institutions and financial markets play a role of channelling money from deficit units to surplus units.c. A dollar today is worth more than a dollar tomorrow.d. When compounding occurs once per year, EAR should be equal to APR.Clear my choiceQuestion 23A portfolio comprises Cochlear (beta of 1.3) and Westpac (beta of 0.8). The amount invested in Cochlear is $20,000 and in Westpac is $200,000. What is the beta of the portfolio?Select one:a. 0.99b. 1.05c. 0.85d. 1.14Clear my choiceQuestion 24An investment pays you $20,000 at the end of this year, and $10,000 at the end of each of the four following years. What is the present value of this investment, given that the interest rate is 3% per year?Select one:a. $54,133.61b. $51,557.60c. $55,505.81d. $52,818.58

CSL, a pharmaceutical company, has a beta of 1.1, and Woolworths has a beta of 1.0. The risk-free rate of

CSL, a pharmaceutical company, has a beta of 1.1, and Woolworths has a beta of 1.0. The risk-free rate of interest is 4% and the market risk premium is 6%. What is the required return of a portfolio with 50% of its money in CSL and the rest in Woolworths?Select one:a. 12.4%b. 9.9%c. 10.3%d. 11.1%Clear my choiceQuestion 26Which one of the following is TRUE?Select one:a. Investors pay more for bonds with credit risk than they would for an otherwise identical default-free bonds.b. Default risk of investment-grade-bonds is greater than that of speculative-bonds.c. During times of uncertainty, credit spread narrows.d. Yield to maturity of a defaultable bond is greater than expected return of investing in the bond.Clear my choiceQuestion 27Assume that the average annual historical return for shares that comprise the Australian All Ordinaries index is 12%, and the standard deviation of returns is 20%. Based on these numbers what is a 95% prediction interval for 2020 returns?Select one:a. -20%, 35%b. -15%, 35%c. -28%, 52%d. -10%, 40%

You are considering purchasing a new car that will cost you $28,000. The dealer offers you 4.9% APR financing for

You are considering purchasing a new car that will cost you $28,000. The dealer offers you 4.9% APR financing for 60 months (with payments made at the end of the month). Assuming you finance the entire $28,000 and finance through the dealer, your monthly payments will be closest to:Select one:a. $467b. $527c. $478d. $1,454Clear my choiceQuestion 38The Sisyphean Company is currently trading for $30.00 per share. The company is expected to pay a $2.50 dividend at the end of the year and its cost of equity is 14%. If the dividend payout rate is expected to remain constant, then the expected growth rate in the Sisyphean Company’s earnings is closest to:Select one:a. 2.7%b. 5.7%c. 8.3%d. 14%Clear my choiceQuestion 39What is the yield to maturity of a two-year, risk-free, zero-coupon bond with a $1,000 face value and a price of $925?Select one:a. 1.968%b. 3.975%c. 8.108%d. 2.633%

1. A firm recently reported $20,000 of sales, $10,000 of operating costs other than depreciation, and $3,000 of depreciation. It

1. A firm recently reported $20,000 of sales, $10,000 of operating costs other than depreciation, and $3,000 of depreciation. It had $20,000 of debt outstanding that carries a 5% interest rate (paid annually) and its federal-plus-state income tax rate is 25%. Compute the firm’s earnings before taxes (EBT).2. A firm recently reported operating income (EBIT) of $10million and had a tax rate of 25%. The firm’s net investment in operating capital totaled $4million. Compute the firm’s free cash flow. 3. A company has operating income of $100,000 and a 25% tax rate. The company has invested capital (i.e., operating capital) of $500,000. Compute the company’s Return on Invested Capital?4. On 12/31/2019, a company reported retained earnings of $500,000 on its balance sheet, and it reported that it had $200,000 of net income during the year. On its previous balance sheet, at 12/31/2018, the company had reported $400,000 of retained earnings. No shares were repurchased during 2019. How much in dividends did the company pay during 2019?5. Suppose a firm’s Total Assets Turnover ratio is 2, its Profit Margin is 12% and its liabilities finance 20% of its total assets. If the firm only uses liabilities and common equity to finance its assets, compute the firm’s Return on Equity (ROE).6. Use the information from Exhibit 1 on the next page to compute the following ratios: (i). Current ratio(ii). Total Assets Turnover ratio(iii). Times Interest Earned ratio(iv). Return on Assets ratio(v). P/E ratio

To minimize taxes owed, you should do the following if you expect to have a higher tax rate next year:

To minimize taxes owed, you should do the following if you expect to have a higher tax rate next year: Multiple Choicea) Accelerate deductions into the current yearb) Quit work at the end of the current yearc) Delay deductions until next yeard) Get a loan for the additional taxese) Delay the receipt of income until next year

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