years

Q: Which are the fundamental relationships to know in any loan refinancing decision include at least th...

A: Loan refinancing decision involves replacement of an existing debt with a new debt. The intention of...

Q: What are the advantages and disadvantages of going public?

A: Going publicIt means any company is being a private company whose IPO becomes publicly-traded as wel...

Q: Evaluate the following statement: “Issuing convertible securities is ameans by which a firm can sell...

A: SOLUTION:- Convertible securities are those securities which have the option to get converted into d...

Q: Explain the major financial ratios and financial cycles, debt ratio, debt to equity ratio, return on...

A: The below ratios are computed using the 2016 financial statements of Walmart Company.

Q: A company has a 12% ROA. Assume that a company’s total assets equal total invested capital, and that...

A: A ratio that helps a company to evaluate the profitability of its assets is term as the ROA (return ...

Q: What key assumption underlies the pure expectations theory?

A: Pure expectations theory in finance refers to the fact that the forward rates are nothing but the re...

Q: Explain risk-free nominal rate of interest rate

A: This is the raw rate of return which does not take inflation into consideration. This is the rate th...

Q: Assume that an average firm in the office supply business has a 6% profit margin, a 40%total liabili...

A: Computation:

Q: An investor can invest money with a particular bank and earn a stated interest rate of 15.40%; howev...

A: Hi there! Thank you for the question. Post has multiple questions. As per company guidelines expert ...

Q: 1. What is the future value of an ordinary annuity that promises $60,000 per year for 10 years if th...

A:   1. FV of Ordinary Annuity​=C×(1+i)n−1​/i where: C=Cashflow per period i= interest rate n= number o...

Q: Explain the term Value investing strategies?

A: SOLUTION:-   Benjamin Graham, an American economist, investor, and professor, pioneered a new method...

Q: the document that facilitates the creation of financial and non financial claims for a coporation is...

A:   Solution:- Corporate charter is a legal document form creation of company. It is filed with secret...

Q: The Calgary Company is attempting to establish a current assets policy. Fixed assets are $600,000, a...

A: SOLUTION:- a) Current Asset Policy of 40% Sales= $3 million Current Assets= 40%*$3 million= $1200000...

Q: You plan to invest in bonds that pay 3.25%, compounded annually. If you invest $10,000 today, how ma...

A: Given: Interest rate is 3.25% Present value $10,000 Future value = $30,000 Number of years =?

Q: a. Use the appropriate formula to find the value of the annuity.   b. Find the interest.   P...

A: The worth of today’s dollar at a future date is the future value of the dollar. For example, the val...

Q: What is an exchange rate?

A: Exchange is the price of one currency derived in another form of currency.

Q: White Flag, a women’s clothing manufacturer, reported salaries expense of $20 million. Th e beginnin...

A: The situation is based on the Accrual concept of accounting where the income and expenses are record...

Q: How much invested now at 7% would be justsufficient to provide three payments, with the firstpayment...

A: Given,  Rate of interest 7% First payment is 10, 000 Second payment is 7500 Third payment is 4000

Q: Your friend suggests that a good way to study whether stock prices are in- formationally efficient i...

A: A fund manager is the manager which manages funds of investors by taking investment decision on inve...

Q: 5. Given the following expectations for the next year, what is the expected return, standard deviati...

A: To determine the Expected Return, Standard Deviation and Beta of Stock A from the data. Return on St...

Q: 1. Assume you deposit $3,000 today, and $300 at the end of each year, in an account earning 4% per y...

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

Q: Time for a lump sum to double: If you deposit money today in an account that pays 6.5% annual intere...

A: Hey, since there are multiple questions posted, we will answer the first question. If you want any s...

Q: To help you reach a $16,000 goal 8 years fromnow, your father offers to give you $4,000 now.You plan...

A: Steps to calculate annual deposits is shown: Calculate the FV of an amount given by the father at t...

Q: Explain how to find the value of a stock given itslast dividend, its expected growth rate, and itsre...

A: A model that helps to evaluate the value of the stock with the assumption that the dividend will gro...

Q: Yield to Maturity and Current Yield You just purchased a bond that matures in 12 years. The bond has...

A: Current Yield = Coupon/Current Price Current Price = 70/5.74% Current Price = 1219.51 Nper = 12 (ind...

Q: Kristina just won the lottery, and she mustchoose among three award options. She can elect to receiv...

A: “Hey, since your question has multiple sub-parts, we will solve first three sub-parts for you. If yo...

Q: Firms HL and LL are identical except for their financialleverage ratios and the interest rates they ...

A: Formula to calculate Net operating profit after tax is given by: EBIT(1-tax rate) Formula for ROIC i...

Q: What is the influence of the secondary mortgage market?

A: STEP 1: INTRODUCTION Secondary Mortgage market is the market where the buying and selling of mortgag...

Q: As a jewelry store manager, you wantto offer credit, with interest on outstanding balances paid mont...

A: Formula:

Q: Suzan Long is considering buying a home for$350,000.(a) If she makes a down payment of $50,000 andta...

A: In this problem, a person purchases a home for $350,000 and make down payment of $50,000. The remain...

Q: Why is having a personal budget so important? (discuss importance of financing yourself, paying fix ...

A: SOLUTION:- A budget is a statement which shows income and expenditure for a particular period of tim...

Q: What is trade credit?

A: Trade credits are advantageous for buyers because they get sufficient time for making their repaymen...

Q: Describe four ways that option pricing is used in corporate finance.

A: There are following 4 ways by which option pricing can be used namely timing option, stock option pl...

Q: An investment that requires $3000 initial investment will return $1000 at the end of first year, $20...

A:

Q: An efficient market is one in which prices__________ to new information quickly. External funding r...

A: Every business requires finance to meet their needs in the economic world irrespective of the nature...

Q: What should be the primary objective of managers?

A: Manager is a person who controls, supervise and manages the overall staff of a particular company. M...

Q: periodic compounding

A: Step 1: Periodic compounding means earning or paying an interest rate more than annually. Using peri...

Q: A 10-year T-bond has a yield of 6%. A 10-year corporate bondwith a rating of AA has a yield of 7.5%....

A: To compensate for the risk taken, a greater return is demanded by the investor over and above the fe...

Q: The Namleda Corporation has an income statement that indicates thatoperating income is $2,375,486 an...

A: The part of a company’s profit which is attributable to its equity shareholders is called Earnings p...

Q: Hello The first question is to how to the formula used in this problem. This is a question that you ...

A: Beta and standard deviation both are common measures which are used to find changes in stock but bet...

Q: Suppose you have the opportunity to make an investment in a real estate venture that expects to pay ...

A: The concept that helps to evaluate the future or present value of the cash flow is term as the time ...

Q: Joe’s starting salary as a mechanical engineeris around $75,000. Joe is planning to place a total of...

A: Formula for Joe's earnings on retirement is: P*[(1+r)^n - (1+g)^n] /(r-g) where P is the first payme...

Q: A machine now in use was purchased fouryears ago at a cost of $30,000. It has a book valueof $9,369....

A: The reduction in the economic value of an asset is term as the economic depreciation. It is the diff...

Q: If a company reported fi ctitious revenue, it could try to cover up its fraud by: C . creating a fi ...

A: Every company tries to do window dressing of its financial statements in a certain way which would b...

Q: Computing the Future Value of an Annuity Stone will deposit $8,250 at the beginning of each year for...

A: The payments are made at the beginning of periods, therefore we will use future value of annuity due...

Q: For an ordinary annuity with five annual payments of $100 and a 10% interest rate,how many years wil...

A: Ordinary annuity: An ordinary annuity is a sequence of equivalent payments made at last of successiv...

Q: Define asymmetric hedge

A: A strategy that helps to reduce the loss which occurs from the movement of the asset's price is term...

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.