Star. An advertisement of an investment firm states that if you invest P500 in their firm today you will get P2,000 at the end of 10 years. What nominal rate is implied if interest is compounded quarterly?

Q: E 14956.75 7. Edward Cariaga loans P35,300 at 6½% simple interest, how long it will take him to get ...

A: Simple Interest is the method in which we calculate the interest on a specific principal amount at a...

Q: Consider a portfolio with a market value of $50 million and a modified duration of 7 years. Its mana...

A:   Modified duration is the change in duration of re-coverability of investment due to change in yiel...

Q: What is the current price of a share of stock when the current dividend is P5, the growth rate is 5%...

A: Under dividend growth model, the current price of stock can be calculated as follows: P0=D1Ke-gWhere...

Q: Cross-Ocean Boats Ltd. is in the 30% tax bracket. It is interested in determining the minimum return...

A: The weighted average cost of capital (WACC) is used to determine the viability of a company's capita...

Q: DD Plc is expected to declare earnings per share of £1.60 next year. The company historically has re...

A: Present value of growth opportunities is calculated using the current market price of stock and earn...

Q: Find the future value of the following ordinary annuity. Periodic Payment Interest Rate Payment Inte...

A: The value of current payment or upcoming flow of payments at any future date when flow of payment te...

Q: The requirement of a real estate property manager to act in the best interests of the landlord when ...

A: Due process refers to the legal requirement that the state respect all legal rights owed to a person...

Q: 3. Presume you purchase a bond for Apple Corporation that a 95% chance of paying at the end and a 5%...

A: Given: Chance of paying = 95% Chance of default = 5% Purchase price = $285 Face value = $285

Q: 8.  Soho plc is a Stock Exchange listed business. Assuming share price of the company increased duri...

A: Price-to-Earnings(P/E) ratio and Dividend Yield(DY ratio) are used by investors to measure the profi...

Q: You own a put option on Ford stock with a strike price of $9. When you bought the put, its cost to y...

A: Put Option: A put option gives the holder the right, but not an obligation to sell the underlying as...

Q: You are an investor who is interested in purchasing AC shares which is currently trading at a price ...

A: Intrinsic value of shares means actual value of shares that is being held by the company or the fair...

Q: Bulldogs Inc. wants to establish a bond portfolio consisting only of BDO bonds which has a maturity ...

A: Par value (P) = P 1000 Coupon (C) = 5% of 1000 = P 50 r = YTM = 10% We need to find the total portfo...

Q: Two types of heat exchangers (y and z) would like to compare the cost of use in a particular chemica...

A: EUAC is uniform equivalent annual cost which is equivalent all cost including the cost of acquisitio...

Q: Consider a 10-year bond with a face value of $1,000 that has a coupon rate of 5.8%, with semiannual ...

A: Bond price implies for the consideration paid by an investor for acquiring bond. In provided case, b...

Q: The nominal annual interest rate on 6-month USD Treasury Bill is 4.50%. The spot rate of the Euro is...

A: The interest rate parity: The interest rate parity theory states that the returns earned by investin...

Q: Following are the card rates announced by the dealing room at 9.00am in the morning          Ch...

A: The selling rate and the buying rate are the exchange rates at which an institution buys or sells th...

Q: What is the current price of a share of stock when the current dividend is P5, the growth rate is 5%...

A: The current price of the stock can be estimated with the help of dividend discount model

Q: Say you want to invest a certain amount of your salary each year. This year you take $2,500 out of y...

A: The value of current payment or upcoming flow of payments at any future date when flow of payment te...

Q: National Co. has outstanding bonds with an annual 8 percent coupon. The bonds have a par value of P1...

A: Par value = P1000 Coupon rate = 8% Annual coupon amount = 1000*0.08= P80 Years to maturity = 11 Year...

Q: National Co. pays annual dividends of P9 on the cumulative preferred stock. What is the current valu...

A: Annual dividend = P9 Required rate of return = 12%

Q: 12 A debtor borrowed P12.700 and after 4 vears, paid back the loan with an 8% interest. How much was...

A: Hi! Thank you for the question, As per the Honor Code, we are allowed to answer one question in case...

Q: Consider two firms – Alpha Co. and Omega Co. – that operate in the manufacturing of mountain bikes a...

A: Degree of operating leverage measures the change in the operating income of the company with the cha...

Q: 2The Bulldogs Inc.’s stock price is believe to decline from its current level of P125 anytime during...

A: Put option is a form of future contract which is being entered between two parties under which one p...

Q: Nominal interest rates are the rates stated or quoted in the terms or contract of a particular secur...

A: Real interest rate is the rate that shows the actual cost of borrowing to the borrower by removing t...

Q: your given the following information about a home loan: loan amount 300000 number of years 25 years ...

A: As per the Given Informatin we have, Loan= 300,000 Interest Rate Given=7% Upfront Rate=3% Total year...

Q: Total Debt Service ratio determines your "capacity to repay". What is the maximum % a client should ...

A: A loan is a liability which allows a person or entity to get immediate funds for their requirement a...

Q: Based on this information, the breakeven points for Bulldogs Co. and National Co. are:   a. 5 millio...

A: Breakeven point is that level of sales revenue at which business is only recovering it's fixed costs...

Q: The Bulldogs Inc. bonds currently sell for P1,500 and the same bond was originally sold at P1,500. T...

A: Issue price = P1500 Current price = P1500 Annual coupon payment = P37.50

Q: A man buys a television set from a merchant who asks P1,250 at the end of 60 days (cash in 60 days)....

A: Amount due = P1,250 Period = 60 days Interest rate = 8%      

Q: An amortization of a debt is in the form of a gradient series of $6,000 in the first year, $5,000 in...

A: When a debt is paid in series of instalments involving principal and interest is called amortization...

Q: g. National Co. estimates that its capital budget for the upcoming year will be P800,000,000, and it...

A: The capital structure of the company consist of debt and equity. Some part is financed by debt and s...

Q: Please read the article and provide a one-paragraph comment on this article. To see how asset alloc...

A: Optimal asset allocation is no one-size-fits-all formula for the investor. Most financial specialist...

Q: 3 | I5 LTN Best, worst, and average returns for various stock/bond allocations, 1997-2019 Portfolio ...

A: Data given::                         Bond                 Stock  Investment %                  ...

Q: Yield to maturity (YTM) is the rate of return expected from a bond held until its maturity date. How...

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

Q: Dennis wants to buy a $370,000 house with a 20% down payment. He is looking at a 20-year mortgage at...

A: Net mortgage = Value of house * (1-% of downpayment) = 370000 * (1-.20) = 370000 * .80 =296000

Q: analyst is trying to determine the intrinsic value of a certain share. Which of the following is tru...

A: To find out the intrinsic value o the stock there two methods one is dividend discount model and fre...

Q: Find the future value of the following ordinary annuity. Periodic Interest Rate Payment Interval Ter...

A: The time value of money states that the same amount of money will have more value today than in the ...

Q: Luna Inc. bonds currently sell for P1,500 and the same bond was originally sold at P1,500. This inst...

A: Originally sold price = P1500 Annual coupon payment = P37.50 Current price = P1500

Q: An earth moving equipment has a first cost of P 25,000, estimated life of 6 years, with no salvage v...

A: In Sinking fund method, the depreciation of the asset is calculated to accumulate the amount of mone...

Q: Increasing debt can be used as part of the financial strategy c

A: Debt refers to the amount which is to be paid back and a fixed amount of interest is charged over a ...

Q: You think you will be able to deposit $4,000 at the end of each of the next three years in a bank ac...

A: Annuity  An annuity is the series of payments which is received or paid for a certain period of time...

Q: Bulldogs Inc. has Dog bonds outstanding with P1,500 face value and 8 years is remaining before its m...

A: Given: Particulars Amount Face value(FV) 1500 Years 8 Current price 1750 Coupon rate 10% ...

Q: nominal annual interest rate on 6-month USD Treasury Bill is 4.50%. The spot rate of the Euro is $3....

A: If the interest parity hold than spot rate and forward must be in equilibrium with interest rates of...

Q: equipment R20000, accumulated depreciation R16000. Depreciation is calculated at 20% p.a. on a dimin...

A: Depreciation: It is the wear and tear of the value of the equipment over the period of the time due ...

Q: Compute the Indirect and Direct Quotations of the following Exchange Rates.   Swedish Krona = ?

A: Here,

Q: Which of the following comes closest to the net present value (NPV) of a project whose initial inves...

A: Initial investment = $5 Cash flow at the end of year 2 (CF2) = $3 Cash flow at the end of year 4 (CF...

Q: The ____ of an annuity is the sum of all payments plus all interest earned

A: As per Bartleby Honor Code, when multiple questions are asked, the expert is required only to solve ...

Q: An investor is evaluating the common share of Bulldogs Inc. which has a beta of 1.8. The expected re...

A: Beta (B) = 1.8 Risk free rate (RF) = 2% Market return (RM) = 8%  

Q: niagara vineyards borrowed $75.000 to update their bottling equipment. they agreed to make payments ...

A: It can be calculated using   =NPER(rate,pmt,pv,[fv],[type]) Rate The interest rate for the loan. Np...

Q: n bought a lot worth ₱1,000,000 if paid in cash. On the installment basis, he paid a down payment of...

A: The loan payment are done based on the interest rate and period of the loan and present value of pay...

Mortgages

A mortgage is a formal agreement in which a bank or other financial institution lends cash at interest in return for assuming the title to the debtor's property, on the condition that the obligation is paid in full.

Mortgage

The term "mortgage" is a type of loan that a borrower takes to maintain his house or any form of assets and he agrees to return the amount in a particular period of time to the lender usually in a series of regular equally monthly, quarterly, or half-yearly payments.