Explain why Fannie Mae and Freddie Mac are an example of moral hazard and based on that critically discuss why financial markets should be regulated.

Q: A growing monthly perpetuity will start 6 months from today.  If the discount rate is 6% APR…

A: A perpetuity is a payment method that pays a fixed periodic amount in the future for a lump sum…

Q: When conducting common-size balance sheet analysis, each item is expressed as a percentage of A)…

A: Common-size financial statement analysis is a method of finding out the relative health of the…

Q: Which of the following statement regarding ratio analysis is incorrect?  Select one: a. Ratios…

A: Financial ratios are an important concept in the world of finance. We use financial ratios like…

Q: How can a small-business owner or corporate manager use financial leverage to improve the firm’s…

A: Financial leverage is a kind of investment strategy.In this strategy borrowed money is used such as…

Q: Bankruptcy risk of a firm increases with the level of: Select one: a. Asset growth b. Profitability…

A: The possibility that a corporation may be unable to satisfy its debt commitments is known as…

Q: Onse took a loan of P2,000 that is repaid by a payment of P2,500 made 24 months later. Find the…

A: Loan amount is P2,000 Amount repaid is P2,500

Q: Evaluate each one of them and recommend the best one. A. Invest in acquiring a newly formed company…

A: Total capital raised - $5 million Option 1 - Invest in a company that is unfortunate to generate…

Q: An annual growing perpetuity has a present value of $363,636.36  What is the growth rate (g) of this…

A: The time value of money is considered for determining the cash flows compounded and discounted…

Q: Innovative Group Ltd, an IT company, is undertaking a new project to develop software for Fair…

A: Here, Expected Rate of Return is 12% Plowback Ratio is 0.30 Return on Equity is 24% Forecasted…

Q: Jasper purchased a car for 47,500. He paid a 20% down payment and financed the rest at 2.88 % for 6…

A: Loan is a value which is borrowed from the external sources like banks for a particular period and…

Q: Discount ₱64,820 at 12.25% interest when compounded semi-annually for 4 years and 5 months.

A: Time value of money (TVM) refers to the method or technique which is used to measure the amount of…

Q: Given an annuity-immediate of 100 payable semi-annually for 10 years. Find the value after 18 years…

A: Future Value: The future value is the amount that will be received at the end of a certain period.…

Q: Hungry Jack’s gives franchisees the right to open a business using Hungry Jack’s name and to follow…

A: These days, franchise opportunities are commonly referred to as business format franchises. When all…

Q: a. Calculate the annual rate of return for each year from the above information. b. What is the…

A: Annual return = ((P1 - P0)/P0)*100 Arthemetic average return = (Return1+.....+Return4)/100 Geometric…

Q: cent as needed

A: A trade discount is a percentage reduction in a manufacturer's asking price for merchandisers.

Q: Long-term and short-term finance tends to be differentiated by:     the amount of finance raised.…

A: Companies can raise finance for long term or for short term. As the name indicates it is the word…

Q: A Rio Tinto corporate bond currently sells for $1,450, which gives it a yield to maturity of 7%. Its…

A: Here, Current Price of Bond (P0) is $1,450 New Price due to change in Yield (P1) is $1,400 Change in…

Q: Springer Products wishes to borrow ​$90,000 from a local bank using its accounts receivable to…

A: Accounts receivable as collateral:   If  business utilizes  its accounts receivable asset as…

Q: Common stock value-Variable growth Personal Finance Problem Home Place Hotels, Inc., is entering…

A:

Q: Rachel has a $15,000, 36 month loan with an APR of 8.25%. a. What is the monthly payment? $

A: Here we will use the concept of time value of money. As per the concept of time value of money the…

Q: Bianca wants to have Php 60,000 in the future. If she decides to deposit 1000 at the end of every…

A: Future Value: The future value is the amount that will be received at the end of a certain period.…

Q: Use the​ end-of-year stock price data in the popup​ window, LOADING... ​, to answer the following…

A: Here,

Q: Colby's gross income was $93,000 last year. If he had $1646.92 withheld for federal income tax from…

A: The gross income of a salaried person is the cost to the company. First, all the exemptions and…

Q: Select the best answer from the five listed below to fill in the blank The residual income approach…

A: Residual Income is the excess of net income over deduction for cost of equity. Dwduction of equity…

Q: a. Nominal interest rate compounded quarterly that is equivalent to an effective interest rate of 8%…

A: Effective Annual Rate: The effective annual rate of interest is the actual or the real rate of…

Q: Consider the previous question with the same yield curve. Now suppose I tell you tha market…

A: Liquidity preference theory states that investor demands a higher rate of return over longer period…

Q: Rajesh would like to buy his first car and the one he has his eye on is $25,000, plus an extra 13%…

A: Solution:-  When a loan is taken, it can either be repaid as a lump sum payment or in instalments.…

Q: Which of the following is not an asset utilization ratio

A: Asset Utilization Ratio: This ratio computes the total sales/revenue earned for every dollar of…

Q: A stock that pays no dividends is worth So = 50 curos today. The risk-free interest rate with…

A: The binomial options pricing model is used to find the price of the option when there is no clarity…

Q: Suppose that your friend has a farm in 2019 and wants to make an investment 150,000 in 2030 for all…

A: Future Investment = 150,000 Time duration = 2030-2019 = 11 years

Q: Which of the following parties would perform an external financial analysis on a firm?     The…

A: External analysis is the analysis done by the people who are outside the firm. These people cannot…

Q: Required ROI 18% Project Omega NPV (Year 0) Project Omega Total NPV Which of the two projects would…

A: Net present value (NPV) of an alternative/project refers to the variance between the initial…

Q: d 10,000 units of chairs from YS furnishing for $300,000. The listed price for 10,000 units was…

A: Trade discount is a percentage reduction in a manufacturer's list price offered to wholesalers or…

Q: Below shows some financial data on General Mills versus Campbell Soup, you collected the following…

A: Ratio analysis helps in the analysis of a firm through the given data of the firm. It can be used to…

Q: From the following price​ data, compute the annual rates of return for Asman and Salinas.   Time…

A: Here,

Q: (a) An investor purchased the share of Neptune Corp on 1 Jan 2017 and held the investment until 31…

A: Arithmetic rate of return Arithmetic rate of return for a year is calculated as shown below.…

Q: 17.  Which of the following is an example of information intermediary?   Select one: a. Internal…

A: Individuals and groups who gather, analyze, and interpret data and report their results to others.…

Q: Which of the following statements about managers' compensation is true? a. High salaries motivate…

A: Granting Stock to managers or key employees triggers as a motivation for the employees as they…

Q: Find the equivalent interest rates to the given nominal interest rates.

A: Effective Annual Rate: It refers to the rate of interest earned on an investment or charged on a…

Q: 14 Calculate the term of each annuity: Future Value Present Value Size of Payment a. 50 $8,500 $675…

A: Present value of annuity: Present value of annuity is the value of all the future cash payments as…

Q: ocusing solely on profits can be dangerous. Explain why shareholder wealth maximization, rather than…

A: Profit maximization is not the same as wealth maximization. A company can pursue both profit…

Q: Loan payments of $2,750 due 96 days ago and $3,100 due today are scheduled to be repaid with a…

A:

Q: What is the future value of a regular $500 60-month annuity (first cash flow starting 1 period from…

A: Future value  Money's value can be described in terms of its future value (compounded) or present…

Q: You invest 2000 into a fund at time 0 and an additional 1000 at time 1. The investment period is 2…

A: As we know, Future value : It is the value of an investment or asset in the future on a specific…

Q: a) Company PLU decides to issue bond to finance its investment in a project. However, the project is…

A: Hai, Thank you for the question. Post has multiple has questions. As per company guidelines expert…

Q: What is the standard deviation of a portfolio composed of 60 per cent Aquaman and 40 per cent Green…

A: Standard deviation refers to a concept which measures the risk involved in a investment. It helps…

Q: Q (a) A put and a call have the same maturity and strike price. If they have the same price, which…

A: Call option A call option is a financial instrument that provide the right to its holder to purchase…

Q: 8. Assume that the CAPM is a good description of stock price returns. The market expected return is…

A: Solution:- Expected alpha of a stock means excess return of a stock over the market.

Q: Why is there a need for  banking regulations to regulate savings  and  the lending of money by…

A: Banks are one of the most important financial institutions. Banks play an integral role when it…

Q: Explain the goal of yield management

A: Yield management is a kind of pricing strategy.It is based on the understanding of the behavior of…

Corporate Ethics

Ethics refers to the moral values and principles that guide an individual. Corporate ethics refers to the moral behavior of a company and its employees while conducting business. Business ethics is another name for corporate ethics. Business ethics reflects the purpose of doing the business. Business ethics is the distinction between what is right and wrong in the workplace and the selection of the right set of actions. Every corporate entity follows business ethics to a large extent in order to survive and compete successfully in the market. Corporate entities that strictly adhere to business ethics gain the trust of their stakeholders and thus gain more customers. An organization follows compliance, i.e., following certain business policies, rules, procedures, and practices to deal with the problem arising from the business environment. Business ethics also ensures that they meet compliance requirements as it was connected with the activities of an organization.