Summarize the action(s) taken by the FOMC as per its Press Release and the Decisions Regarding Monetary Policy Implementation on March 15th, 2020.

The following table gives Foust Company's earnings per share for the last 10 years. The common stock, 8.1 million shares outstanding, is now (1/1/20) selling for $70.00 per share. The expected dividend at the end of the current year (12/31/20) is 50% of the 2019 EPS. Because investors expect past trends to continue, g may be based on the historical earnings growth rate. (Note that 9 years of growth are reflected in the 10 years of data.)

The current interest rate on new debt is 11%; Foust's marginal tax rate is 25%; and its target capital structure is 40% debt and 60% equity.

1. Calculate Foust's after-tax cost of debt. Round your answer to two decimal places.

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   Calculate Foust's cost of common equity. Calculate the cost of equity as r_s = D₁/P₀ + g. Do not round intermediate calculations. Round your answer to two decimal places.

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2. Find Foust's WACC. Do not round intermediate calculations. Round your answer to two decimal places.

     %

Bellinger Industries is considering two projects for inclusion in its capital budget, and you have been asked to do the analysis. Both projects' after-tax cash flows are shown on the time line below. Depreciation, salvage values, net operating working capital requirements, and tax effects are all included in these cash flows. Both projects have 4-year lives, and they have risk characteristics similar to the firm's average project. Bellinger's WACC is 11%. 0 1 2 3 4 Project A -1,050 700 425 210 260 Project B -1,050 300 360 360 710

What is Project A's payback? Do not round intermediate calculations. Round your answer to four decimal places. years

What is Project A's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places. years

What is Project B's payback? Do not round intermediate calculations. Round your answer to four decimal places. years

What is Project B's discounted payback? Do not round intermediate calculations. Round your answer to four decimal places. years

What are the similarities and differences been property/casualty insurance companies and life insurance companies

Your portfolio is contains $11,845 invested in a mutual fund with a beta of 1.3, and $4,740 invested in an ETF with a beta of 0.8. You want to re-balance your portfolio so that it will have an overall beta of 0.8. You plan on selling shares of one asset to buy shares of the other. How many shares of the mutual fund will need to sell (or buy) to achieve your goal? The ETF is trading at $16.40 and the mutual fund is trading at $7.80. Write your answer as positive if you are buying shares of the mutual fund, and write it as negative if you are selling the shares of the fund. Round your answer to one decimal place. Answer:(1,518.6)

Your portfolio is contains $11,385 invested in a mutual fund with a beta of 2.4, and $980 invested in an ETF with a beta of 0.4. How much (in $) should you transfer from the mutual fund to the ETF so that your overall portfolio beta is 0.9? You will not add any money to the portfolio, you are just transferring money from one asset to another.

If re-balancing requires transferring money from the ETF to the mutual fund, write the answer as a negative number.

Answer is 8,294 need to know how to arrive to that number

The market is expected to yield 9.4% and the risk free rate is 1.2%. You currently hold a portfolio with a beta of 0.7 worth $24,400. You want to invest in another portfolio with a beta of 1.8. How much will you have to invest in the new risky asset so that the resulting portfolio will have an expected return of 11.4%? Note: You are adding funds to the new asset and to the overall portfolio. answer in $ not in percentage.

Answer is 23,864.90 but I am getting 20,328.14

Security valuation: equity. Next year, your company expects net income of $44 million. It pays 50% of its earnings out in dividends and has a cost of equity capital of 11%.

a. If your company’s NI has a 7% growth rate, what is the estimated value of your company?

b. What is its re-investment rate (i.e. internal rate of return on earnings retained and reinvested)? Now suppose instead that the company’s re-investment rate (i.e. internal rate of return) on all future retained earnings is only 11%, and continue to assume initial earnings of $44 million.

c. What would be the value of your company if it maintains a dividend payout ratio of 50%?

d. Does the value of the company in c. above change if the payout ratio is reduced to 25%? Why or why not?

e. Find the company’s market capitalization one year from now under each of the two dividend policies described in c. and d. Which payout policy leads to a greater increase in stock price?

f. How can you reconcile the seemingly contradictory results obtained in parts d. and e.?

Provide some specific examples of how firms have chosen to hedge using futures or forward contracts. This could possibly include agricultural operations as well. Be sure to identify the risk the firm is trying to control.

Obtain the most current Balance of Payments (BOP) of Singapore and briefly discuss surpluses or deficits on major accounts. What is the total amount of foreign reserve of this country? Please attach the BOP to your project and highlight all the potential numbers. Thank you!

the antimarino aircraft corp is considering the following two mutually exclusive investment options:

1) annuity revenues each year will be $100. total costs(fixed costs + variable costs) will be $80 each year. ( for simplicity assume there is no depreciation expense. initial net working capital requirements are $20 at start up, and will not grow. the firm will make a capital expenditure of $250 at startup and have annual expenditures of $10 at the end of each year. the project will last 20 years. the firm will have $200 dollars of debt and $200 dollars of equity.

2) growing perpetuity- revenues in the first year will be $100. revenues will grow at 5% per year. total costs will be $80 in the first year and will also grow by 5% per year ( assume no depreciation expense). initial net working capital requirements are $20 at startup and will grow by 5% per year. the firm will make a capital expenditure of $250 start up, plus annual expenditures of $10 at the end of the first year and will grow by 5% per year. the firm will have $300 of debt and $100 of equity.

Regardless of which option they choose, the following facts will hold true:

cost of debt = 7% beta = 1.2

tax rate =25% t note rate =3% market return =14%

which project should they choose?

What mutual funds would you recommend for a 22 year old college graduate who just landed their first real career job? They are making 35,000 dollars a year. They are able to invest 100 dollars every month into their 401K plan. They will retire at age 70. They are young and they are not frightened of risk. They have 48 years to invest. What would you suggest for them? Be very specific in your recommendations.

East Coast Warehouse Club   

Frank​ O'Connor, CFO of East Coast Warehouse​ Club, was reviewing notes from the annual​ shareholders' meeting the week before. Most of the meeting was​ routine: greetings from the CEO and chairman of the​ board, review of last​ year's results, plans for the coming​ year, election of directors​ (no surprises), ratification of the​ auditors, and so on. The only unexpected incident occurred during a​ question-and-answer period with the CFO when a major institutional shareholder asked if and when the company expected to start paying dividends. The question was met with loud applause and a few cheers of​ "Hear, hear!" Frank​ answered, not quite​ truthfully, that the matter was being discussed internally and was on the agenda for the next board of​ directors' meeting. In any​ case, it was on the agenda now.

When the directors met the following​ month, they looked over a report they had asked the CFO to compile on the pros and cons of instituting dividends. The report first provided a review of the​ company's financial situation. A recent economic downturn and high energy prices had been devastating for other​retailers, but had actually been good for East Coast because​ hard-pressed consumers looked for the lowest prices on everything from groceries to computers to automobile tires and batteries. East Coast had recently added gas pumps to many locations and could sell gasoline for a few cents less per gallon than other retailers. The gas business was​ thriving, and company research showed that gas sales brought customers to the stores for other purchases. On the other​ hand, East​ Coast's growth policy had become cautious. Its extensive real estate holdings were losing value in a declining​ market, and the company was unwilling to build stores so close together that it would be competing with itself or so far from its regional base that distribution would become inefficient. Ten percent of total assets were now in cash and​ short-term investments. ​ Long-term debt had fallen from 38% of assets a few years ago to less than 22%.

Cash flow from operations was more than double the investment in new assets.

There was no question that East Coast could pay a​ dividend, but should​ it? Frank wondered what some of his bright young staffers long dash—several of whom had used East​ Coast's generous education benefits to obtain MBA —would have to say about this​ question, so he put it on the agenda for the regular Wednesday afternoon staff meeting.

Questions

1.  The following is a partial list of comments made by staffers at the meeting. To help Frank make a​ decision, identify the dividend policy or theory each reflects and comment on its usefulness.

a. ​ "What difference does it make if we pay dividends or​ not? Shareholders can always sell a few shares and make their own​ dividends." ​ Response: ​ "That works for the big​ shareholders, but what about the little​ guys?"

b. ​ "From a tax​ perspective, our shareholders would be better off paying the capital gains tax than paying the tax on​ dividends."

c. ​ "Stock prices go up and down due to market factors we​ can't control. A dividend is something you can count​ on."

d.  ​"Some of our shareholders want dividends. You heard that at the​ shareholders' meeting." ​ Response: ​ "That's right, ​ but, of​ course, maybe some of them​ don't. They might prefer that we try to grow the business​ faster."

e. ​ "Our business has been doing​ well, but​ we're in tough times. A lot of retailers are​ hurting, and the market is down. By paying a​ dividend, we send a message to our shareholders that we expect to stay strong for the foreseeable​ future."

f.  ​"Before we think of paying​ dividends, we should be sure we have enough cash to cover our operating expenses and capital​ budget." ​ Response: ​ "That's right, and once we start paying​ dividends, we will never be able to cut​ them."

2.  When Frank thought he had gathered enough ideas about dividend theory and​ policy, he asked the following​ question: ​ "Let's say we decide that our shareholders want some kind of distribution. ​ What's the best way to do​ it?" Evaluate the merits of the following suggestions.

a. ​ "How about a 20% or 30% stock​ dividend? They will feel as if​ they're getting​ something, and it​ won't use any​ cash."

What mutual funds would you recommend for a 40 years old single man who is saving for his retirement? He hopes to retire at age 70. He is a moderate risk taker. He will definitely need these funds for living expense, after retirement. Be very specific in your recommendations.