Discuss three key characteristics of active fund management and three of passive fund management, focusing on how the objectives of active management differ from those of passively managed funds.

Q: In​ mid-2018, some analysts recommended that General Electric​ (GE) suspend its dividend payments to...

A: Current share price is the present value of future cash flows associated with the shares. This is th...

Q: ERR

A: ERR refers to the interest rate at which the cash outflows and cash inflows of the project discounte...

Q: You are a financial analyst for a division of General Motors. Your division is considering two inves...

A: Given, Two projects A and B with initial investment of $25 million. The cost of capital is 10%.

Q: How much should be placed in this account at the end of each quarter if the annual interest rate is ...

A: Sinking Fund: It is the fund set aside to contain money by the company to pay off the debt in the f...

Q: A certain machine has book value of P120,000 after 5 years and P80,000 after 7 years. The book value...

A: Initial cost of equipment will be total of carrying value and accumulated depreciation

Q: Previous balance, Finance charge- Purchase- New balance 2 month Previous balance, Finance charge- Pu...

A: A credit card is issued by banks or financial institutions that allows cardholders to make payments ...

Q: A metal plating company is considering four different methods for recovering by-product heavy metals...

A: The rate which makes the total discounted worth of cash flows equal to zero is called IRR or interna...

Q: A special power tool for plastic products costs $400,000 and has a four-year useful life, no salvage...

A: The period in which the cost of asset including working capital investment is fully recovered from t...

Q: E2. A 41-year-old consulting engineer wants to set up a retirement fund to be used starting at age 6...

A: Amount deposited now (D) = $20000 n = 65 years - 41 years = 24 years r = 6%

Q: a. Determine the equal payment series coumpound amount factor after 8 years b. Determine the total a...

A: A stream of equal cash flows paid or received periodically is termed as annuity. Annuity is either r...

Q: You have 3 pounds of egg whites. You need 8 oz to make one serving of consomme. How many servings ca...

A: Data given: i) 3 pounds of egg white ii) Need 8 oz to make one serving of consomme.   Required: No. ...

Q: Microsoft Inc.is currently being sold at $235.75 per share. Rose Gardens found out that last year th...

A: The fair value of stock is equal to the present value of all future dividends to be earned or expect...

Q: Q1. Risk and Return Big Rock is listed on the local stock exchange and its stock has had mixed perfo...

A: Arithmetic mean and geometric mean is used in finance to find out the performance of an investment. ...

Q: Bank A pays 8% interest, compounded quarterly, on its money market account. The managers of Bank B w...

A: Nominal rate of return is also called stated rate of return on an account. It does not take into acc...

Q: Big Rock has several investment portfolios with a local mutual fund company. One of the company’s di...

A: “Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only on...

Q: Big Rock has several investment portfolios with a local mutual fund company. One of the company's di...

A: The formula for the calculation of Sharpe ratio is as follows: Sharpe ratio=Expected return on portf...

Q: What is an efficient market and why is it important for derivatives markets?

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one...

Q: The ingredients forryour skillet brownie cost $1.89. You want your food cost percentage for this ite...

A: Food cost percentage is variable cost ratio. The minimum sales price will be calculated by dividing ...

Q: Peter Chan aged 35 is married and has 1 children. His wife, Susan aged 30, is a homemaker but attend...

A: In the form of a policy, insurance is a contract in which an individual or entity receives financial...

Q: Management of the Toys R4U Company needs to decide whether to introduce a certain new novelty toy fo...

A: Note: This post has several subparts. The first three have been solved below.        

Q: 1. P6,000 quarterly investment at 8% interest compounded quarterly for 8 years mo 2. P4,000 monthly ...

A: The future value of the annuity of investments means the future value of the deposits that will be m...

Q: 8. An education fund will offer a P40, 000 annual scholarship for the first five years, a P60, 000 s...

A: Present value (PV) of all the cash flows is the sum of the money deposited now. It is an example of ...

Q: principle invested

A: “Since you have posted a question with multiple sub-parts, we will solve first three subparts for yo...

Q: the consultant's report, the cash flows that can be generated from the upgrade are as follows and 2)...

A: NPV Net present value (NPV) is the present value of all cash flows resulted in different time period...

Q: Chef Fabio does beginning inventory on Thursday night and finds that he has $1456 in food products i...

A: The cost as a percentage of the sales helps in finding out exactly how much profit we are earning an...

Q: Gyutaro wishes his sister to receive P600,000.00 twelve years from now. What amount should he invest...

A: The present value is calculated by discounting the future values by 1+r factor for the given require...

Q: 10. NPV versus IRR Piercy, LLC, has identified the following two mutually exclusive projects: Year C...

A: NPV is the difference between present value of cash inflows and INTIAL INVESTMENT NPV =PV of all cas...

Q: the cash flows for this project be?

A: Cash flow shows the amount of cash inflow and outflow from the company. The cash flow statement repr...

Q: Amanda is going to invest to help with a down payment on a home. How much would she have to invest t...

A: The concept of the time value of money states that the same amount of money has more value now than ...

Q: What amount of money deposited 35 years ago at 8% interest would provide a perpetual payment of $10,...

A: A perpetual payment is one that goes on forever. We will need to compute the present value of the pe...

Q: 12. A 20-year 1000 par value bond is purchased at a discount. The bond pays annual coupons of 4%. Th...

A: Bonds are issued at discount or at premium of the par value of bond and discount is below par value ...

Q: You would like to sell 200 shares of Xenith Bankshares, Inc. (XBKS). The current ask and bid quotes ...

A: Bid size is the number of securities that investors are ready to buy at a certain bid price. The bid...

Q: nie purchases a television from a salesman who promises her 25,000 if she returns it in 61 days. Ann...

A: The simple interest is interest without the impact of the compounding that is the plain interest wit...

Q: Calculate the compounded interest after 7 years and 9 months if 500,000 is placed at an annual rate ...

A: a) Amount invested (A) = 500,000 n = 7 years 9 months = 93 months r = 11.28% per annum = 0.94% per m...

Q: You deposit $700 in an account paying 7.3% simple interest. Find the future value of the investment ...

A: Deposit amount (P) = $700 Interest rate (r) = 7.3% Period (t) = 4 Years

Q: Tanysha plans to invest $15,000 at the beginning of each year for the next 10 years. If her invested...

A: An annuity is defined as the series of payment made each year for a definite period of time. In annu...

Q: 5. Calculating IRR If the required return is 11 percent, should the firm accept the following projec...

A: 5. IRR is the required rate of return for the project to have zero Net Present value.   IRR can be c...

Q: Assume that you start with a balance of $3900 on your credit card.During the first month you charge ...

A: Here, Balance on Credit Card is $3900 APR is 29% Charges for first Month is $400 Charges for Second ...

Q: The present value of an annuity of “Y" pesos payable annually for 8 years, wit the first payment at ...

A: We can use the concept of time value of money here. As per the concept of time value of money the wo...

Q: Bond valuation and yield to maturity Personal Finance Problem Mark Goldsmith's broker has shown him ...

A: Bond value: A bond's value is calculated by discounting the bond's predicted cash flows to the prese...

Q: Marie's current salary as a Systems Engineer is $100,000 per year. She's planning to place 18% of he...

A: The future value of an investment is calculated by multiplying the invested amount by 1+r factor for...

Q: b) Magen's Bakery, Inc., is considering the purchase of a new cake mixing equipment for $200,000. Th...

A: Net working capital Net working capital is required to run the business. It is calculated as shown b...

Q: According to MM propositions, which of the following statements best describes the consequence of de...

A: The M&M Theorem, or the Modigliani-Miller Theorem is a capital structure theory developed by Mod...

Q: r expected return on this investment?

A: Expected return on investment refers to the rate of return that an investor is expecting on an inves...

Q: 1. What are the current financial issues that can affect the operating environment of a multinationa...

A: 1. Multinational corporations are much more common today than they used to be. Many companies have f...

Q: have 24 quarts of brown stock. You need .75 cups to make one serving of kidney beans. How many servi...

A: As per our guidelines we are supposed to answer only one question (if there are multiple questions a...

Q: BC Corp. recently obtained a 30-year (360-month), P250,000 mortgage with a 9 percent nominal interes...

A: We need to use loan amortization formula to calculate remaining balance after 5 years. Fist we need ...

Q: Use to determine the regular payment amount, rounded to the nearest dollar. Consider the following p...

A: The cost of mortgage is equal to the sum of the total cost of interest, closing cost and the cost of...

Q: 3. If money is worth 8% compounded quarter ly, determine the present value of the following: a. An a...

A: Annuity is a series of equal cash flows occurring at regular intervals. A perpetuity is an annuity t...

Q: . You buy a 6 year bond with an annual 5% coupon at par value, $1000. If the yield to maturity at th...

A: Since you have asked multiple questions, we will solve the first question for you. If you want any s...

Flow of Funds

The flow of funds is the financial accounts of the nation, which monitor and control the cash flow among various sectors or industries, or markets. Central banks use these flow of funds statements to acquire macroeconomic data, to publish cash inflow and cash outflow statements of the nation. This flow of funds system is utilized to identify economic activity and changes in the economy. It is used by Federal Reserve to determine the Gross Domestic Product (GDP) of the nation and to implement monetary policy and fiscal policies.