A young couple wants to have a college fund that will pay $30,000 at the end of each half-year for 8 years.

(a) If they can invest at 6%, compounded semiannually, how much do they need to invest at the end of each 6-month period for the next 18 years to begin making their college withdrawals 6 months after their last investment? (Round your answer to the nearest cent.)

(b) Suppose 8 years after beginning the annuity payments, they receive an inheritance of $34,000 that they contribute to the account, and they continue to make their regular payments as found in part (a). How many college withdrawals will they be able to make before the account balance is $0? (Round your answer to the nearest whole number.)

1. Better Mousetraps has developed a new trap. It can go into production for an initial investment in equipment of $6 million. The equipment falls in the 5-year MACRS, it can be sold after 6 years for $500,000. The applicable depreciation rates are 20%, 32%, 19.20%, 11.52%, 11.52% and 5.76%. The firm believes that working capital at each date must be maintained at a level of 10% of next year’s forecast sales. The firm estimates production costs equal to $1.50 per trap and believes that the traps can be sold for $4 each. Sales forecasts are given in the following table. The project will come to an end in 5 years when the trap becomes technologically obsolete. The firm’s tax bracket is 35%, and the required rate of return on the project is 12%.

Year 0: 0

Year 1: 0.5

Year 2: 0.6

Year 3: 1.0

Year 4: 1.0

Year 5: 0.6

Year 6: 0.2

Thereafter 0

1. What is project NPV?

: Consider the following information: State of Economy Probability of State of Economy Rate of Rtn Stock A Rate of Rtn Stock B Rate of Rtn Stock C Boom .20 .24 .45 .33 Good .35 .09 .10 .15 Poor .30 .03 -.10 -.05 Bust .15 -.05 -.25 -.09 a. Your portfolio is invested 30 percent each in A and C, and 40 percent in B. What is the expected return of the portfolio? b. What is the variance of this portfolio? c. What is the standard deviation of this portfolio? d. What does the standard deviation reveal?

Use the Black-Scholes formula to find the value of a call option based on the following inputs. (Round your final answer to 2 decimal places. Do not round intermediate calculations.) Stock price $ 62 Exercise price $ 59 Interest rate 8 % Dividend yield 4 % Time to expiration 0.50 Standard deviation of stock’s returns 28 %

A no-load fund charges a 12b-1 fee of 1% and maintains an expense ratio of 0.75%. Assume the securities in which the fund invests increase in value by 6% per year. How much will an investment of $1000 grow to after 5 years?

In japan, honda's export price is yen 3million. spot rate is yen100/$ suppose suddenly the rate changes to yen90/$. Assuming 60% exchange rate pass-thru, what should be the price of Honda in U.S. in $? Show work please.

A)$33,000

B)$33,333

C) $31,999

D) $31,333

E) Need more information

Stocks for Fumbeshi and Mundashi have the following historical returns: Table 2 Year Fumbeshi Mundashi 2010 -18% -14.5% 2011 33% 21.8% 2012 15% 30.5% 2013 -0.5% -7.6% 2015 27% 26.3% (i) What is the average return rate of return for each stock during the period 2010 through 2015? (ii) Assuming someone held a portfolio consisting of 50 percent of stocks Fumbeshi and 50 percent stocks of Mundashi, what would have been the realized return on the portfolio during this period? (iii) What is the standard deviation of each stock during the period 2010 through 2015? (iv) Which of the stocks Fumbeshi or Mundashi performed better in terms of both the risk and return? (Hint: Back your answer with computations) Total

Suppose that ABC Corp. has an equity beta of 1.5. Current risk-free rates are 5% and the expected return on the market portfolio is 15%. ABC Corp has a market value debt-to-equity ratio of 0.5, debt that is rated AA, and faces a 21% tax rate. Assuming that the credit spread on AA debt is 2%, compute ABC Corps WACC? Enter your answer as a percent without the % sign. Round to two decimals.

Two financial assets with gross return (R1, R2) are jointly normally distributed. E(R1) = 1.06 and E(R2) = 1.12. V ar(R1) = 0.03, V ar(R2) = 0.04, and Cov(R1, R2) = 0.025. Draw the mean-variance frontier formed by the two assets. Mark the minimum variance. Notice that the mean of portfolio formed by these two assets falls in the interval of [1.06, 1.12].

You think a certain stock in the gold-mining industry (stock A) is overvalued, so you plan on shorting $10,000 of it. You would like to isolate your bet on the alpha of the stock, so you want to hedge out all your exposure to the market and to the gold-mining industry.

Stock A has a market beta of 1.1, and a gold-mining industry beta of 1.5.
Asset B (a gold-miners ETF) has a market beta of 0.8 and a gold-mining industry beta of 1.5
Asset C (SPY) has a market beta of 1 and a gold-mining industry beta of 0.2.  

If you used assets B and C to get a portfolio that had a market beta and gold-mining industry beta of 0,

1）How many dollars would you put in Asset B?

2）How many dollars would you put in Asset C?

Halliford Corporation expects to have earnings this coming year of $ 2.93 per share. Halliford plans to retain all of its earnings for the next two years. For the subsequent two​ years, the firm will retain 51 % of its earnings. It will then retain 18 % of its earnings from that point onward. Each​ year, retained earnings will be invested in new projects with an expected return of 21.57 % per year. Any earnings that are not retained will be paid out as dividends. Assume​ Halliford's share count remains constant and all earnings growth comes from the investment of retained earnings. If​ Halliford's equity cost of capital is 9.3 %​, what price would you estimate for Halliford​ stock? ​Note: Remenber that growth rate is computed​ as: retention rate times rate of return. The price per share is ​$ ..... ​ (Round to the nearest​ cent.)

A speculator believes that the EUR—currently trading at 1.60—will be trading in the range 1.70 - 1.80 in six months. She wishes to buy a EUR call option with a strike price of 1.70 so that at any value above 1.70, the option will have a positive payoff. However, because she does not believe that the EUR will trade above 1.80, she sells a EUR call option with a strike price of 1.80. Evaluate the consequences of the speculator's actions. Show potential consequences by constructing a spreadsheet. Discuss pros and cons of this strategy. Also assess whether this option combination is a better strategy than simply buying a EUR call with a strike price of 1.70.

Clinton Vines has an $800,000 portfolio. He will invest his funds in the market portfolio (with a return and risk of 8.5% and 17%, respectively) and in risk-free securities (with a risk-free return and risk of 3.3% and 0%, respectively). If he wants the highest possible return subject to his risk being no greater than 14%, how much will Clinton invest in T-bills and in the market portfolio?

You're crafting a portfolio of two stocks. You plan to buy $3,000 worth of the first stock and $1,000 worth of the second stock. The standard deviation of the first stock is 20% and the standard deviation of the second stock is 40%. They have a correlation coefficient of 0.3. How volatile will the portfolio be? Answer in percent rounded to two decimal places. (e.g., 4.53% = 4.53)