Statement 1: Risk management tools decreases the volatility of the firm’s cash flow. Statement 2: Commodity prices are potentially affected largely by the landscape of laws and politics.   Only statement 1 is true Only statement 2 is true Both statements are true

Q: Pink Inc. has been growing at a constant rate of 10% each year and produce earnings per share of P4....

A: Intrinsic value is also referred to as the price of stock. It is also the accepted value of a compan...

Q: The following table summarizes the yields to maturity on several one-year, zero-coupon securities: a...

A: Yield of treasury = 3.11% Yield of AAA corporate = 3.17% Yield of BBB corporate = 4.18% Yield of B c...

Q: National Co. provides consultancy services to various corporate clients in luzon. The growth rate is...

A: Residual income is the amount of income left after covering the equity charge. The equity charge is ...

Q: If today 1 US Dollar can buy 3 Korean Won and 1 Korean Won can buy equals 2 Philippine Peso, what is...

A: Exchange rate (ER) is a value at which two or more currencies are exchanged or traded. To make the p...

Q: In early​ 2018, Coca-Cola Company​ (KO) had a share price of $43.36​, and had paid a dividend of $1....

A: Solution:- Companies pay a part of their earnings to shareholders, which is known as dividend. Now, ...

Q: Padma's semi-annual premium is $975.00. She has the choice of paying the full amount or paying half....

A: Insurance is one of the ways to reduce the risk. Insurance means get put the insurer in same financi...

Q: You have an opportunity to invest in a FinTech start up. You will have to make two annual payments -...

A: Expected annual return or IRR indicates the anticipated compound annual rate of return earned on an ...

Q: The shares of AMC plc are currently quoted at 200p per share and the company has been paying a divid...

A: Note: All the Above Mentioned Given Options are incorrect, so we are solving for the correct solutio...

Q: a. What are the free cash flows of the​ project? (starting with year 0) b. If the cost of capital is

A:   Cash flow refers to the amount of cash that a company has after considering all the expenses and c...

Q: ABC Corp issued a bond with a maturity of 12 years. It has a 9 percent annual coupon, a yield to mat...

A: Face value (FV) = P1000 Coupon rate = 9% Yield to maturity (r) = 8% Years to maturity (n) = 12 Years...

Q: National Inc. has 100 bonds outstanding with maturity value each of P1,000. The nominal required rat...

A: Par value of bond (FV) = P1000 Coupon rate = C Semi annual coupon amount (P) = 1000*C/2 = 500C Years...

Q: Company A is a motion picture production company. At the end of its most recent financial year, the ...

A: Here, Book value of Debt = $500,000,000 (Including interest for 8 years) Pre-cost of debt = 8% Lever...

Q: Boots and Shoes inc has sales of $7525, total assets of $3215 and a debt equity ratio of 1.30. If it...

A: Sales = $7525 Total assets = $3215 Debt to equity ratio = 1.30 Equity to asset ratio  = 1/(1+Debt to...

Q: You are deciding between two mutually exclusive investment opportunities. Both requife the same init...

A: Given: Initial investment =$10 Million Investment A cash flows = $2.3 Million Investment B Cash flow...

Q: How much is the interest expense for the year 2020?

A: A bond is a type of investment that is made by the investor as a loan to a borrower and charges a fi...

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

A: Growth rate  (g) = 3% Required return (r) = 8% Expected dividend (D1) = P25

Q: your company is considering a new project that will require $10,000 of new equipment at the start of...

A: Annual depreciation =(Cost-Salvage value)/Useful Life =(10000-3000)/5 =$1400/year

Q: A BBB-rated corporate bond has a yield to maturity of 7.4%. A U.S. Treasury security has a yield to ...

A: Here,

Q: 6. Stock Valuation Suppose you know that a company's stock currently sells for $67 per share and the...

A: Let the growth rate = g Stock price today (P0) = $67 r = 10.8% r is dividend evenly between dividend...

Q: 4.5 percent forever. If the stock currently sells for $43.15 per share, what is the required return?

A: Next dividend (D1) = $2.65 Stock price (P0) = $43.15 Growth rate (g) = 4.5%

Q: Arnold Inc. is considering a proposal to manufacture​ high-end protein bars used as food supplements...

A: This question is about finding out the NPV of the Project where Cash inflows and outflows are given....

Q: 4. Use MV = P(1 + RT) to find the maturity value (in $) of the loan. Principal Rate (%) Time Maturi...

A: The maturity value is calculated as sum of principal and interest earned

Q: If the discount rate is 8 percent, then the projects NPV is $. (Round to the nearest dollar.)

A: Net present value (NPV) of an investment refers to the variance between the initial investment or pr...

Q: National Co. is considering leasing or purchasing a small aircraft to transport executives between m...

A: Here, Cost of Debt is 7% Tax Rate is 40%

Q: On January 1, 200A, ABC Company sells to XYZ, a used transportation equipment, which was acquired at...

A: The promissory notes also known as the notes receivables are the fixed documents which shows the amo...

Q: Suppose a ten-year, $1,000 bond with a 8.9% coupon rate and semiannual coupons is trading for$1,035....

A: Face Value = $1,000 Coupon rate = 8.9% Bond's price = $1,035.32 Compounded semi-annually 

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

A: We can use the dividend discount model here. The first step will be to find the fair value or the in...

Q: An accountant for Bulldogs Inc. must calculate the weighted average cost of capital of thecorporatio...

A: Weighted average cost of capital(WACC) is the average or overall cost of capital of the company whic...

Q: gage debt service ratio? O 70.27% O 62.51% O 90.25% O 56.41%

A: Mortgage debt services ratio is quite extensively used in granting the mortgage loans. That show pay...

Q: How many futures contracts should be added to the portolio to meet the target beta? Round to 0 decim...

A: The relative volatility of an individual stock portfolio, as assessed by a selected stocks betas of ...

Q: How banks can improve their return on equity and what are its negative externalities.

A: RoE is ubiquitous in banks, serving as both an indicator of overall performance and a means of alloc...

Q: Assume the spot Swiss franc is $0.7030 and the six-month forward rate is $0.7010. What is the Value ...

A: Here, Spot Price is $0.7030 Six Month Forward rate is $0.7010 Strike Price is $0.6830 Risk Free Rate...

Q: A new electric saw for cutting small pieces of lumber in a furniture manufacturing plant has a cost ...

A: Cost = $4000 n = 10 years Salvage value = 0  

Q: compute the capitalized cost of a new car worth 800,000 if it is estimated that is requires 20,000 p...

A: Purchase price  = 800,000 Annual cost = 20,000 Salvage value = 300,000 Period = 5 Years Interest rat...

Q: Phil has systematically contributed $3000 to his RRSP at the beginning of every three months for the...

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

Q: Consider the accompanying cash flow diagram (please click the link below), which represents three di...

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

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

A: Callable bonds are those bonds which can be bought back by the issuer at a predetermined date before...

Q: s are purchasing a $240,000 home with a 30-year fixed mortgage at an APR of 4.5%. They made a 10% do...

A: Mortgages are paid by the monthly payments that carry the payment for the loan and interest rate. Mo...

Q: You just signed a business consulting contract with one of your clients. The client will pay you $45...

A: Solution :- With rise in inflation, the service charges will also increase. So, when inflation rate ...

Q: Bulldogs Inc. has a P1,200 face value bond with 8 years until maturity. The bond possesses a charact...

A: We need to use RATE formula in excel to calculate yield to maturity. The formula is =RATE(NPER,PMT,-...

Q: What do entrepreneurs do that distinguishes them from any other person involved in the business?

A: A business is an enterprise entity or an organisation which is present to carry out a variety of act...

Q: A man bought a condominium unit worth ₱3.9M a pay a down payment of ₱1.5M and agreed to pay the rema...

A: Present value of future value of money to be received in future is value of money without the intere...

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: A man bought a condominium unit worth ₱3.9M a pay a down payment of ₱1.5M and agreed to pay the rema...

A: The 1st installment is paid at the end of the 2nd year.    Present worth = present value

Q: Just in preparation for his retirement, a man intended to invest today into a bank with an interest ...

A: Nominal interest rate is interest without considering the impact of the compounding and is less annu...

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: How much is the expected rate of return for Stock B? Use a whole number in

A: Expected return refers to the return earn by an investor on the amount invested during a period of t...

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: Calculate the annual effective interest rate using ERR method i

A:   ERR stands for economic rate of return means it compares the benefits from the project with its co...

Q: Franco is considering investing P18,500 in an investment that will have a maturity value of P32,500 ...

A: Investment amount (P) = P18,500 Maturity value (F) = P32,500 Period = 8 Years Monthly period (n) = 8...