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Given that the equity beta of Microsoft is about 1.10, the market value of its common equity is $61.0 billion, and the company has no debt or preferred stock outstanding, what is its unlevered beta?
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The cash flows from financing activities section of a statement of cash flows would not include cash: a. from issuance of common stock. b. to employees as wages. c. to banks for the repayment of notes payable. d. from sale of equipment.
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A retailer sells MP3 players for $140 each. Cost is $100 per unit. All units sold. Units produced exceed units sold by 8,000. Which of the following is true? A) There will be a higher income under variable costing than under absorption costing B) There will be a lower income under variable costing than under absorpti...
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NewAge Inc. paid a dividend yesterday of $3 per share. NewAge management expects the dividend to increase next year to $4 annually. If the dividend is expected to stay at $4 per year for the foreseeable future, what is the value of the stock to an investor with a required rate of return of 10%?
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Bonds are sold at 101.25 which means that they are selling at: a. 101% of face value, a discount of 1.25% of the face value. b. 100% of face value, a premium of 1.25% of the face value. c. 101% of face value, a premium of 1.25% of the face value. d. 101% of face value, a discount of 1.25% of the face value. e. 101...
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Which of the following is NOT true about the Income Statement under variable costing: a) The contribution margin equals revenues minus variable expenses. b) The fixed manufacturing overhead cost is expensed in full in the year it is incurred. c) The gross margin, the difference between revenues and the cost of goods...
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Find the present worth of $3,400 quarterly end of period deposits for 10 years if the interest rate is 12% compounded semiannually. a. $116,365.6 b. $137,684.4 c. $117,152.5 d. $136,983.8
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Which of the following is true? a. managers will choose the capital structure that maximizes EPS. b. a firm's optimal capital structure is determined by its business risk and its tax rate. c. financing decisions should not be made based on the goal of maximizing EPS. d. maximizing firm value and maximizing stock pr...
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The Carthage Sceptre Corporation is evaluating a possible investment in a new regional distribution warehouse. A careful evaluation of the anticipated net cash flows and net investment expected from the project indicates that the expected net present value (NPV) of this project is $4.5 million. The anticipated standard...
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Superior Corporation is expected to pay a $3.50 per-share dividend at the end of the year (D1 = $3.50). The stock currently sells for $80 per share and its required rate of return is 12 percent. The dividend is expected to grow at some constant rate, g, and the stock currently has 30,000 outstanding shares. Assuming th...
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Keenan Company's cost of goods sold is $340,000. Purchases of inventory for the year were $280,000. The cost of ending inventory at the beginning of the year was $24,000 and the cost of ending inventory at the end of the year was $30,000. What is the amount of total inventory variance?
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Dooley, Inc., has 8 percent coupon bonds on the market that have 9 years left to maturity. The bonds make annual payments. If these bonds are selling for $1,123.94, what is their YTM?
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Your firm has been in business for three years and has been profitable in each of those years. At the end of its third year, your firm's cash balance is $25,000, its receivables are $25,000, and its payables are $20,000. The market value of the stock is $50,000. Your firm has net working capital of: a. $0 b. $15,000 ...
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An individual plans to save for retirement by investing equal amounts at the beginning of each year starting today. The first investment will be made today. Starting 38 years from today, the individual will begin to withdraw $141,572 per year for 13 years (the last withdrawal will be made on the day she retires). The a...
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A manufacturing company needs a new punch press. The original equipment manufacturer offers a financial plan whereby the company purchases the punch press now from the manufacturer for {eq}\$120,000 {/eq}. The financial plan calls for {eq}\$40,000 {/eq} to be paid now, {eq}\$40,000 {/eq} to be paid in one year, and ...
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Consider a parallel plate capacitor with an area of 2.00 cm{eq}^2 {/eq} and a separation of 3.00 mm. The left plate has a +15.0 nC charge, and the right plate has a -15.0 nC charge. The capacitor is filled with a dielectric material with a relative dielectric constant {eq}\kappa {/eq} = 3.72. Determine the net elect...
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Find the volume V of the solid bounded by the graphs of x^2+y^2=9, y^2+z^2=9, and the first octant.
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A firm is expected to pay a dividend of $2.00 next year and $3.00 the following year. Financial analysts believe the stock will be at their price target of $60 in two years. Compute the value of this stock with a required return of 12%.
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Suppose that we wish to compute the probability P(R > 1000), where R is the revenue per customer, given the following probability mass function: r p(r) 100 200 300 400 500 600 700 800 900 1000 1100 1200 P(R=r) 0.01 0...
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A bond has a clean price of $1,450 and a market price of $1,457.75. What is the accrued interest? a) 102.60% b) 62.75% c) 5.30% d) 7.75% e) 4.65%
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Assume that capital is fixed at 100 units and that labor cost is $100 per unit. What is the most profitable number of workers to hire? Quantity of Labor Total Product Marginal Product Value of the Marginal Product 0 0 - - 1 14 14 140 ...
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Using the following table, determine the dividend yield of the S&P 500 Index fund. S&P 500 Index fund Total return 12.00% Price $110.41 Dividends paid $3.00
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Willingham Co. made the following journal entry: Date Account Title Debit Credit Dec. 31 Interest Receivable $2,000 Interest Income $12,000 In its December 31, 2014 balance sheet, the interest receivable account should be reported with a: A. debit balance of $2,000. B. credit balance of $2,000. C. debit b...
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How do you find the inverse Laplace transform of #1/s#?
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A small metal bead, labeled B, has a mass of 42.7 g. A small plastic bead, labeled P, has a mass of 69.4 g. A small metal bead, labeled M, has a mass of 34.3 g. The beads are insulated and have negligible diameters. Which arrangement of the beads, in terms of distance (in cm), would produce the largest mutual attractiv...
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A parallel plate capacitor has circular plates with radius 24.5 cm. The gap between the two plates is 1.15 mm. The electric field between the plates is 631 N/C. The potential difference between the plates is:
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What is the total work done when a charge of {eq}-5.5 \times 10^{-6}\ C {/eq} is moved from (0,0) to (2,5) in the potential {eq}V=3x^2y {/eq}?
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Dilip's Discount Furniture has $3 million of accounts receivable. The company's sales are $54 million. The company wants to reduce its days-to-sales by 5 days. The company plans to reduce its days-to-sales by lowering the bad debt expense from 4.5 percent of sales to 4.0 percent. The cost of capital is 6.75 percent. ...
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What is the rate of return on an investment that increases in value from $500 to $1,000 in 5 years?
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Buyers and sellers form a _____ if the futures price is _____ the spot price and the futures price _____ with the passage of time. A. short position, less than, falls B. short position, greater than, rises C. long position, less than, rises D. long position, greater than, falls
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Use Green's Theorem to evaluate the integral of {eq}\vec F = (y^2 - x^2, 2xy) {/eq} around the closed curve {eq}C {/eq} which is the boundary of the part of the ellipse {eq}\frac{x^2}{4} + \frac{y^2}{9} =1 {/eq} to the left of the y-axis.
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Air systems company purchased a new machine for $600,000 to produce its product. The machine has an estimated useful life of 8 years and a residual value of $30,000. After 8 years, the company expects to sell the machine for its residual value. If the company uses the straight-line method of depreciation, the annual de...
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Let X be an exponential random variable with $\lambda = 1$ Find $E(X|X>1)$
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An investment manager has a portfolio with an expected return of 10% and a volatility of 15%. The investment manager is considering adding either stock Q or stock R to his portfolio. Both Q and R have an expected return of 10%. Q has volatility of 15% and a correlation of 0.4 with the portfolio and R has volatility of ...
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Assuming perfect competition, what will the economic profit be for the firms that are still in the market if demand is given by P=20-Q, each firm has constant marginal cost of $5, and there are 100 firms in the market? A. $40 B. $150 C. $1,950 D. $2,000
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The director of capital budgeting for Big Brew is considering the purchase of a new bottling machine. This machine will cost $97,000 and is expected to have a 10-year useful life with no salvage value. The new machine will have an operating cost of $16,000 per year and will produce an increase in earnings of $39,000 pe...
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Tim Womack, the president of Animal Specialty Products, Inc., recently returned from an important meeting with the sales manager. During the meeting the sales manager urged the president to increase the quantity of plastic toys that could be produced by the company's molding machine. The sales manager explained that th...
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Find the ordinary interest on $6800 from January 28 to May 2 of a non-leap year.
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Taggart Transcontinental currently has a bank loan outstanding that requires it to make three annual payments at the end of the next three years of $1,000,000 each. The bank has offered to allow Taggart Transcontinental to skip making the next two payments in lieu of making one large payment at the end of the loan's te...
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Unearned revenue is classified as a(n) a. current asset b. prepaid expense c. current liability d. deferred revenue e. revenue
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Kohler Inc. enters into a lease on January 1, 2015, for 20 years. The fair value of the lease is $896,000. The leased asset has a useful life of 20 years. Kohler uses the straight-line method to calculate lease expense. Kohler's tax rate is 40%. How much expense will Kohler record in 2015? a. $44,800 b. $17,920 c. $...
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A seller has agreed to sell a business to a buyer for a $1.2 million payment due two years after the contract is signed and a $2.5 million payment due four years later. No interest is indicated in the contract. The applicable federal rates are short term 5%, mid-term 7%, and long term 9%. What interest rate will be im...
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A bank has gross interest income of $150 million, operating expenses of $10 million, a tax expense of $5 million, and dividends paid of $3 million. Its average interest rate paid on deposits is 3.5%, and the average yield on loans is 6.5%. The bank holds securities whose market value is 8% of its total assets, and it h...
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How much current is flowing in a wire if {eq}5.0 \times 10^{16} {/eq} electrons pass a point in the wire every 2.0 seconds? a) 4.0 A b) 0.10 A c) 0.40 A d) 1.6 A e) 8.0 A
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Baker Company makes and sells two types of boots: waterproof boots and field boots. The contribution margin ratio of the waterproof boots is 25%, while the ratio for the field boots is 40%. The company expects to sell four field boots for every three waterproof boots sold. The company's fixed expenses total {eq}\$400,0...
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Demonstrate your understanding of the concept of accrued interest by completing the following statement: If you buy a bond at the time it makes a coupon payment and the next coupon payment is due in two months, you: a) Pay no interest. b) Pay accrued interest for two months. c) Pay the full interest payment. d) Bot...
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_____ strategies are designed to eliminate, reduce, create, or raise some previously assumed dimension of product/market supply and demand. A) New-market creation B) High-end disruption C) New-market disruption D) Low-end disruption
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A firm has 12,000 bonds outstanding, each selling for $108.00 with a 7 percent coupon. What is the after-tax cost of debt for this firm if the applicable tax rate is 34% and the bonds mature in 12 years?
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The stock of U.S. Robotics Inc. currently sells for $39 a share. The company just paid a dividend of $2.5 a share (D0 = $2.5) and has a constant growth rate of 3% in earnings and dividends. What is the expected price of the stock six years from now?
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Paull Co. reported net income for 2017 of $180,000. For 2018, Paull reported net income of $210,000. In addition, Paull reported the following information for 2018: Retained earnings, December 31, 2017$600,000 Dividends declared and paid during 2018$80,000 Treasury stock bought during 2018$25,000 Using this informati...
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The cash account shows a balance of $38,400 before reconciliation. The bank statement does not include a deposit of $9,900 made on the last day of the month. The bank statement shows a collection by the bank of $3,600 and a customer's check for $1,330 was returned because it was NSF. A customer's check for $1,370 was r...
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The Bottling Department of Rocky Springs Beverage Company had 6,000 ounces in beginning work in process inventory (40% complete). During the period, 85,000 ounces were completed. The ending work in process inventory was 8,000 ounces (20% complete). What are the total equivalent units for conversion costs?
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A put option and a call option with an exercise price of $85 and three months to expiration sell for $2.40 and $5.09, respectively. If the risk-free rate is 4.8 percent per year, compounded continuously, what is the current stock price?
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Use Laplace transform to solve the following O.D.E. y'' + 4y' + 6y = e^{-2t} y(0) = 0 ; y'(0) = 3
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Company A authorized payment of salaries expense within the discount period. This decision will: a. Increase this period's cash flow from operations. b. Decrease this period's cash flow from operations. c. Not affect this period's cash flows from operations. d. Affect cash flows from both operations and financing.
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Find the amount to which {eq}\$ 800 {/eq} will grow at a 7% interest rate in 5 years, 10 years, and 20 years.
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If {eq}f{/eq} is the largest integer function and {eq}g(x) = \int\limits_{ - 4}^x {f(t)\text{d}t}{/eq} , then find the value of {eq}g'(2){/eq}.
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A mutual fund manager wants to invest $10 million in U.S. securities for the coming year and is considering three options: a. Purchase of {eq}\$10 \ million {/eq} of Eurobonds with a {eq}6\% {/eq} coupon and a current yield of {eq}7\% {/eq}. The fund would sell the securities at par at the end of the year. b. Purcha...
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Assume that Germany has a domestic investment of $1.5 trillion, private domestic savings of $3 trillion, and a government deficit of $1 trillion. Based on the national saving and investment identity, if government spending rises by $1 trillion, its trade deficit will equal: A. $500 billion. B. $2 trillion. C. $4 tri...
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You borrowed $15,000 from a student loan. If they charge 7.5% interest compounded monthly and you can pay back $300/month, how many years will it take for you to pay back the entire debt? a) 5.01 years b) 5.34 years c) 5.99 years d) 6.59 years e) None of the above
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An increase in the tax rate would: a. increase the slope of the aggregate demand curve. b. decrease the slope of the aggregate demand curve. c. increase the intercept of the aggregate demand curve. d. decrease the intercept of the aggregate demand curve.
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An increase in government spending in the open economy goods market model leads to: a. an upward shift in the demand for domestic goods, an increase in output, and a decrease in net exportsb. an upward shift in the demand for domestic goods, an increase in output, an upward shift in the net exports relationship, and a...
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Shown below are kinetic energy and potential energy curves for an object in the {eq}(x, y) {/eq} plane. Select all of the answer choices that are true. A. The object must be at its highest point at {eq}y = +2 {/eq} m. B. The object must be at its highest point at {eq}y = -2 {/eq} m. C. At the point where {eq}x =...
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Suppose that the government increases business investment tax credits for firms in the current period. How would this policy affect the Solow growth model? a. {eq}\bar{a}_{1} {/eq} would rise and k* would rise b. {eq}\bar{a}_{1} {/eq} would rise and k* would fall c. {eq}\bar{a}_{1} {/eq} would fall and k* would r...
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You borrow $90,000 to pay college tuition. The loan carries an annual interest rate of 13 percent and requires you to make quarterly payments of $3,000. How many payments will it take to pay off the loan? (Answers are rounded up.) a. 87 b. 17 c. 23 d. 116 e. 20 f. 121
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Find the exact length of the curve. Use a graph to determine the parameter interval. x= \cos t + \ln(\sin t), \quad 0 \lt t \lt \pi/2
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Let F = xi + yj + zk. Use the tangential vector formula (eqn 2) to show that: {eq}\oint_{c} F \cdot dr = \oint_{c} (ydx - xdy + 0dz) {/eq} where c is any closed curve.
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Which of the following statements about joint-cost allocation is FALSE? A. Joint cost allocation is useful in deciding whether to further process a product after split-off. B. Joint cost allocation is useful in making a profit determination about individual joint products. C. Joint cost allocation is helpful in inve...
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Suppose that the ratio of wages-to-price for industry A is 0.4, and 0.6 for industry B. If the prices of industry A rise by 5 percent and the prices of industry B rise by 3 percent, then in the long-run we would expect: a) The wage rate in industry A to rise, and the wage rate in industry B to fall b) The wage rate i...
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What is the estimated cost of debt for a firm with a 7% coupon rate, semiannual coupons, a $1,000 par value, 24-year maturity, and a current price of $930? The firm's marginal tax rate is 40%. a) 5.53% b) 5.86% c) 7.00% d) 7.18%
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Three years ago ABC bonds were issued with a 9 percent coupon. If these bonds are currently selling for 102 percent of par, what is the expected rate of return to an investor who purchases these bonds at the current market price? a. 8.6% b. 8.7% c. 8.8% d. 9.1%
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After looking at the table of financial ratios for Intercontinental and Westamperial Airlines given below, look at the data for the financial performance of Intercontinental and Westamperial Airlines for the two years presented in the following table. Intercontinental Airlines Westamperial Airlines In millions of d...
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LiSun manufacturing uses a job-order costing system. During the last period, direct labor costs totaled $144,000, based on $48 per hour, and actual overhead costs for the period totaled $212,000. The predetermined overhead allocation rate for the last period was $44 per direct labor hour. LiSun assigned all its under/o...
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Suppose that the central bank has increased the money supply such that there are an additional $318,784 in excess reserves. If the reserve ratio is 7.0 percent, what is the maximum the money supply could increase? Round your answer to the nearest dollar.
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What is the radius of convergence of the series \(\displaystyle \sum_{k=1}^\infty 2^k x^k\)?
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Partners B and I receive a salary allowance of $28,000 and $42,000, respectively, and share the remainder equally. If the company earned $100,000 during the period, the entry to close the income or loss into their capital accounts is _____. a. Income Summary 60,000 B, Capital 28,000 I, Capital 32,000 b. Income Summar...
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A firm borrows $9,000 that it must repay in 4 years. The interest rate on the loan is 6.5%. How much will the firm have to pay back at the end of 4 years? A. 11,074 B. 10,213 C. 12,477 D. 11,760
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Find the centroid of the region bounded by the parabola y = x - x^2 and the line y = 0.
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ABC Corporation is considering a project that will require a $218,000 investment in equipment with a useful life of four years. At the end of four years, the project will terminate and the equipment will be sold for its salvage value. The company's discount rate is 12%. The straight-line method of depreciation is used...
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Use the work-energy theorem to solve the following problem. A 0.40-kg soccer ball approaches a player horizontally with a speed of 17 m/s. The player kicks the ball back in the direction from which it came with a speed of 25 m/s. The contact between ball and foot lasts 5.0 * 10^-3 s. Determine the average force exerted...
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A uniformly dense solid cylinder with a mass of 2kg and a radius of 5cm at the top of a ramp. What is the maximum angle (in degrees) for the ramp in order for the cylinder to roll without slipping down the ramp? In other words, if the ramp is set at a larger angle the cylinder will roll down the ramp while also slippin...
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Let $X_1, X_2$ be independent and uniformly distributed on $(\Theta, \Theta+1)$. Consider the two tests with critical regions $C_1$ and $C_2$ given by $$ C_1 = \{ (x_1,x_2)|x_1 \geq 0.95 \} $$ and $$ C_2 = \{ (x_1,x_2)|x_1+x_2 \geq c \} $$ to test $H_0: \Theta = 0$ versus $H_1: \Theta= \frac{1}{2}$. Find the value of c...
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From the following data, calculate the money multiplier: Cash in banks and public's hands $80,000 Demand deposits $300,000 Excess reserves $20,000 Reserve ratio is 8%
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According to a report by the U.S. Fish and Wildlife Service in 2005, there were 513 condors in a population in Utah and Colorado. If the population declines by 2% per year, how many condors will there be in the population after 15 years?
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If interest is compounded continuously, the balance in a bank account after {eq}t{/eq} years is {eq}A = 3600e^{0.066t}{/eq}. What is the balance after 12 years?
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An increase in the number of firms in an industry _____ the price in the long run. a. increases. b. decreases. c. does not change. d. can either increase or decrease.
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Senff Inc., which began business at the start of the current year, had the following data for the year: Sales revenue$3,687,500 Salaries and wages expense2,111,600 Rent expense782,500 Bad debt expense55,250 Interest expense51,200 Interest revenue84,500 Net income for the year was: a) $31,000. b) $71,250. c) $142,5...
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An investor in a 35% marginal tax bracket is considering a municipal bond yielding 4% and a corporate bond yielding 12%. What is the after-tax yield on the corporate bond? a) 4.8% b) 6.3% c) 7.8% d) 9.5% e) None of the above
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Assume a minimum attractive rate of return of 12 percent/year compounded quarterly. Determine the present worth of a new piece of construction equipment with the following cash flow. {eq}\text{Year 0: }\$-40,000 {/eq} {eq}\text{Year 1: }\$-6,000 {/eq} {eq}\text{Year 2: }\$-6,000 {/eq} {eq}\text{Year 3: }\$-6,000...
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On December 31, 2012, Masefield Company leased a machine from Colt for a five-year period. Equal annual payments under the lease are $50,000 (including $2,500 annual executory costs) and are due on December 31 of each year. The first payment was made on December 31, 2012, and the second payment was made on December 31,...
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Machine D costs $140,000, has a life of 10 years and will return a benefit of $62,000 in the first year, and increasing by 5% for the life of the machine. The first-year costs for Machine D are $23,000, increasing by an inflation rate of 3% per year. The salvage value at the end of life of the machine is 15% of the ori...
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Assume jPhone, Inc., has an equity multiplier of 1.62, total asset turnover of 1.55, and a profit margin of 4.2 percent. What is its ROE? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places (e.g., 32.16).)
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A firm has a marginal revenue function {eq}MR = 450 - 2Q. {/eq} Its marginal cost function is {eq}MC = 5Q^2 - 3Q + 20. {/eq} What is its equilibrium price?
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Suppose that the quantity of loanable funds is lower in the current period than desired. Which of the following policies might help solve this problem? a. a decrease in income tax rates b. a decrease in government transfer payments c. an increase in real interest rates d. an increase in government spending e. a re...
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Hershey's Stock is currently selling for $80 per share. The company's noncallable $1,000 par value bonds mature in 14 years, pay interest annually, have a coupon interest rate of 10%, and are selling for $1,075.18. The firm's tax rate is 35%. The cost of common stock is 12% and the cost of preferred stock is 9%. The ba...
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Assuming that marginal cost curve is a smooth J-shaped curve, the corresponding total cost curve has a (an) a. linear shape. b. S-shape. c. U-shape. d. reverse S-shape.
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What is the inflation rate for the economy described in the table below if year 1 is the base year? Year 1 Year 2 Year 3 Price level 100 105 108 Nominal GDP 4,500 5,100 5,400
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A block of mass 0.2 kg is held against a wall by applying a horizontal force of 5 N on the block. What is the frictional force acting on the block? (coefficient of friction is 0.4) Is the answer 1 N or 8 N?
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Is the following equation correct: $r\binom{n}{r}\binom{n-r}{m-r}=\binom{n}{m}\binom{m}{r}$, where $n,m,r\in \mathbb{Z^+}$ and $m>n$?
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A 10-year U.S. Treasury bond has a 3.50% interest rate, while a same maturity corporate bond has a 5.25% interest rate. Real interest rates and inflation rate expectations would be the same for the two bonds. If a default risk premium of 1.50% is estimated for the corporate bond, determine the liquidity premium for the...
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