3. Carl has an account with $73,000 that earns 1.25% interest compounded monthly. Find the amount of money he can receive from the account every month for the next 20 years.

Q: Profitability Ratio for pepsi CO

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Q: What are possible fraud symptoms in this case

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Q: Estimating vacancy and collection losses at 5% of gross income, reconstruct. Required 1%. Calculate…

A: Property value:  Property values indicate the likely price of a property at a certain point in time.…

Q: X is the only daughter of the richest man in the Philippines. Her father and mother died in an…

A: The answer is option D. No, X is not yet the real owner of the properties of her parents so she…

Q: The Cookie Jar bakes 80 dozen cookies at a cost of $1.08 per dozen. If a markup of 60% om selling…

A: Solution:- We know, markup means the percentage margin added either on cost or sales price.

Q: Which of the following correctly characterizes the risks in merger arbitrage? O A. The strategy is…

A: Merger arbitrage is the process where an investor trades in the stock of the companies involved in…

Q: Vamoose plc is a company based in the Teeside which manufactures components for the motorised…

A: Equipment Cost  £       66,00,000.00 Scrap Value  £       23,00,000.00 Per Unit Price  £…

Q: Advanced Products is considering the purchase of a computer-aided manufacturing system that requires…

A: Solution:- Accounting Rate of Return means the percentage of increase in net income per year to the…

Q: 19. Odette has a base monthly salary of S1,500 and earns a 5% commission on all sales she makes at…

A: In this question, we need to calculate the total sales, which we need to derive from Odette's  total…

Q: You’ve been offered $3000 in 4 years for providing $2000 today into a business venture with a…

A: This is a problem involving time value of money. That is the purchasing power of $2000 today will be…

Q: A coupon bond that pays interest of R40 semi annually has a par value of R1,000, matures in 4 years,…

A: Face value = R1,000 Discount  = R36 Price = 1000-36 = R964 Years to maturity = 4 Years Number of…

Q: ou are considering an investment in Justus Corporation's stock, which is expected to pay a dividend…

A: First we need to calculate the growth rate: Calculate the growth rate using the following formula:…

Q: BNP Paribas has 800 depositors. Each depositor deposits $1,000 into the bank at t=0. BNP Paribas…

A: Simple Interest: Interest refers to the cost of borrowing money.  When the interest is charged only…

Q: Jane is planning on saving for a car purchase in 8 years, however, she can only contribute to the…

A: Here we will use the concept of annuities and time value of money. The amount invested by Jane at…

Q: Calculate the expected return for each stock assuming the Capital Asset Pricing Model (CAPM) is…

A: Risk free rate = 5% Expected return on market = 11% Beta of stock A = 0.7 Beta of stock B = 1.4

Q: expected return of 20% and a beta of 1.4, and the risk-free rate is 8%, how much money will she…

A: Portfolio Return: It is computed by the sum of individual returns of the portfolio security that…

Q: Archer Arrow Company examined its cash management policy and found that it takes an average of 5…

A: Given Number of customer per day P80,000 Number of days checks received from customers is 4 days

Q: Which of the following bank services involves financial derivatives? Credit services O Transaction…

A: A derivative is an agreement between two or more parties in which the value is determined by an…

Q: Local Co. has sales of $10.9 million and cost of sales of $6.1 million. Its selling, general and…

A: Ratio Analysis is the method of checking the company's operational efficiency, liquidity, and…

Q: 25) What is the present value of the following set of cash flows, discounted at 15% per year? Year 1…

A: Present Value=Future value/(1+r)n rate=15%

Q: . Faith is taking out an $7,500, 1½-year loan with an APR of 8.75%. What is the monthly payment for…

A: Loans are paid by the monthly equal installments and these carry the payment for principal and also…

Q: Clara wants to go on a cruise in 5 years. She plans on putting $25 every week into an account that…

A: Data given: Payment (pmt)= $25 N=5 years nper=5 years *52 = 260 Interest rate = 2.4% (compounded…

Q: Which project below would you consider acceptable? One whose IRR is greater than the MARR One whose…

A: Solution: Internal Rate of Return (IRR) is the rate of return which the project yields ie. the…

Q: Construct a table showing the amortization of the loan.

A: Amortization: It is the process of paying the loan amount in periodic payments by the borrower to…

Q: Confidentiality and privacy

A: Confidentiality means protecting secrecy. Banks have a duty to protect the confidentiality of their…

Q: . A sum of $145,000 is invested now and left for 8 years, at which time the principal is withdrawn.…

A: As there is more compounding more is effective interest rate and more is for monthly compounding.…

Q: Why might an investor prefer to invest directly rather than indirectly?

A: The reasons why the investors prefer to invest directly than indirectly are because: Control: It…

Q: A Treasury bill has a bid yield of 5.44% and an ask yield of 5.29%. The bill matures in 69 days.…

A: Given, The face value is $10,000 Time to maturity is 69 days

Q: Following is a table for the present value of $1 at compound interest: Year 6% 10% 12% 1 0.943 0.909…

A: When we need to compute the PV of any future sum receivable at a specific point in time, we use the…

Q: Direct 24,642.07 $1,647,203,780.25 $1,924,086,640.32 $3,479,937,664- Indirect 5,457.38…

A: The present value of labor income and value added would be the equivalent cash flow considering the…

Q: 2. Spring LLC is planning for investment in Debt market. The company is targeting the following…

A: Bond can be defined as a government security which acts like debt security which includes repayment…

Q: Automatic dividend reinvestment O is a requirement of all mutual fund companies. compounds share…

A: Dividends are the distribution of a portion of a company's earnings, as determined by the company's…

Q: You buy a 10-year $1,000 par value 4.60% annual-payment coupon bond priced to yield 6.60%. You do…

A: Face Value = 1000 Coupon rate = 4.60% Yield to maturity = 6.60% Tax rate = 15%

Q: What is the net cash flow to the firm in year 4

A: Net cash flow can be defined as the net amount of cash and cash equivalents transferred in and out…

Q: Question 1 Which of the following is true? O Forward contracts have no default risk. O Forward…

A: Solution:- Forward is an agreement in which two parties contract over the counter each other to sell…

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A: As per the dividend stock model the fair value of a stock today is the present value of all future…

Q: A factory company has 5 years to prepare for relocating in another place. The equipment for loading…

A: Capital rate per year can be defined as the amount to be capitalized on annual basis. It is…

Q: You just graduated with MBA in Accounting and Finance from the University of Professional Studies…

A:

Q: A project requires a $34,000 initial investment and is expected to generate end-of-period annual…

A: Solution:- Net Present Value (NPV) means the net present value of cash inflows after adjusting…

Q: What was the closing price for  McKesson  on July 7, 2016?

A: The closing price for  McKesson on July 7, 2016, is 191.20

Q: Luis won the lottery; however, the lottery company gave him the following two options to receive his…

A: Given,  Amount earns 4.5% p.a simple Interest  So, Per month Interest = 4.5%/12 = 0.375% Two months…

Q: long-term debt, preferred stock, and commercial paper

A: Debt that matures in more than one year is called long-term debt. Long-term debt is a liability for…

Q: $1,000 face value bond pays a coupon rate of 6%. The bond makes semiannual payments, and it matures…

A: Bond can be defined as a loan from an investor to a company or government.. The investor will…

Q: What is the required return on common stock using CAPM? % Use the retention growth equation to…

A: Required Rate of Return: It represents the expected return on common stock from the investors. It…

Q: A stock has a beginning market value of $70. It can either increase in value 30% each year or…

A: Possible share price at end of year 3: S_uuu = 70*1.3^3 = $153.79 Let S denote share price, u…

Q: Jennie invested a certain amount in a bank compounded semi-anually.The bank told her that the…

A: Solution:- When an amount is deposited somewhere, it earns interest on it.  The amount invested is…

Q: How long will it take for an investment to increase by 139% its amount if money is worth 14% comp.…

A: Given, Amount will be 139% at the end of the period  So, Let's assume amount now is 100 amount at…

Q: Jefferson's recently paid an annual dividend of $2 per share. The dividend is expected to decrease…

A: The Gordon growth model is used to determine the stock price based on a future series of dividends…

Q: Company 2019 Gross $4,250,000 Revenue |Company 2019 Gross $1,628,000 Profit Annual 58% Retention…

A: Customer lifetime Value = M(1+d/1+d-r) where,M=Margind= discount rater = retention ratio Customer…

Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary. 

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.