The note is due April 1, 2013. Shabbona would normally have to pay interest at a rate of 10% for such a borrowing, and the dealership has an incremental borrowing rate of 8%. ** Truck #3 has a list price of $16,000. It is acquired in exchange for a computer system that Shabbona carries in inventory. The computer system cost $12,000 and is normally sold by Shabbona for $15,200.
A- What is the finance charge on this loan? $50 + $5 = $55 B- Dave borrowed $500 on January 1, 2006 & paid it all back at once on Dec 31, 2006. What was the APR? $55 on $500 or 11% APR C- If Dave paid the $500 in 12 equal monthly payments, what is the APR? 20.3% 4.
11 percent $ _____ c. 7 percent $ _____ 2. Watters Umbrella Corp. issued 20-year bonds 2 years ago at a coupon rate of 8.4 percent. The bonds make semiannual payments. If these bonds currently sell for 90 percent of par value, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
A family spends $28,000 a year for living expenses. If prices increase by 4 percent a year for the next three years, what amount will the family need for its living expenses? Answer: PV (1 + i)^n or, PV (1 + .04)^3 or, $28,000 * 1.125 = $31,500 needed for the family’s annual living expenses. 5. What would be the yearly earnings for a person with $6,000 in savings at an annual interest rate of 5.5 percent?
Valuation Questions Question 1 Union Pacific Railroad reported net income of $770 million in 1993, after interest expenses of $320 million. (The corporate tax rate was 36%.) It reported depreciation of $960 million in that year, and capital spending was $1.2 billion. The firm also had $4 billion in debt outstanding on the books, rated AA (carrying a yield to maturity of 8%), trading at par (up from $3.8 billion at the end of 1992). The beta of the stock is 1.05, and there were 200 million shares outstanding (trading at $60 per share), with a book value of $5 billion.
1. Two pieces of equipment costing $ 15,000 and $ 35,000 = $50,000.00 2. Material required for electrical hook-up is 400 feet at $ 25 per foot = $10,000.00 3. Controls for each piece of equipment are estimated at $ 600 each = $1200.00 4. Required start-up material is 3,700 pounds at $ 2.70 per pound = $9,990.00 5.
Exercise 2.27: A company enters into a short futures contract to sell 5000 bushels of wheat for 450 cents per bushel. The initial margin is $3000 and the maintenance margin is $2000. a. What price change would lead to a margin call? Loss: $3000 - $2000 = $1000 * F = $ 1000 5000 = $0.2 = 20 cents/bushel * F2= $450 + $ 20 = $470 b.
(A) 25.20 Euros (B) 12.68 Euros (C) 12.90 Euros (D) 12.86 Euros 2 www.assessmentday.co.uk Q4 (A) (B) (C) (D) How much is the total annual dividend payable for 1,550 shares in Drebs Ltd? Cannot say 635 Euros 2,232 Euros 2,418 Euros Q5 If the exchange rate is 1.15 Euros to the £, what is today’s value of 250 Drebs Ltd shares (in £s)? (A) £4,500 (B) £2,785 (C) £3,931 (D) £3,913 3 www.assessmentday.co.uk Q6 A field sales agent plans to travel on average 4,250 miles per month driving along motorways in her Xtam car. What is her projected average annual consumption of fuel (in gallons)? (A) Cannot say (B) 1,500 (C) 125 (D) 150 Q7 A car dealership has £600,000 to spend and wants to buy equal numbers of the Taber and Ursa cars.
3. You purchase 300 shares of Square Enix at $40 per share. To pay the purchase, you borrow $4,000 from your broker. The interest rate on the loan is 5%. a.