Suppose you take out a 20-year mortgage for a house that costs $416,531. Assume the following:

• The annual interest rate on the mortgage is 4%.
• The bank requires a minimum down payment of 10% at the time of the loan.
• The annual property tax is 2.4% of the cost of the house.
• The annual homeowner's insurance is 1.0% of the cost of the house.
• The monthly PMI is $68
• Your other long-term debts require payments of $819 per month.

If you make the minimum down payment, what is the minimum gross monthly salary you must earn in order to satisfy the 28% rule and the 36% rule simultaneously?

Question: What happens to the price of a three-year bond with an 8% coupon when interest rates change from 8% to 6%?

Answer: Price increase of $1053.44

Please show how, thank you!

(This is all the information I was given)

The Karns Oil Company is deciding whether to drill for oil on a tract of land that the company owns. The company estimates the project would cost $11 million today. Karns estimates that, once drilled, the oil will generate positive net cash flows of $5.06 million a year at the end of each of the next 4 years. Although the company is fairly confident about its cash flow forecast, in 2 years it will have more information about the local geology and about the price of oil. Karns estimates that if it waits 2 years then the project would cost $13.5 million. Moreover, if it waits 2 years, then there is a 90% chance that the net cash flows would be $5.83 million a year for 4 years and a 10% chance that they would be $2.86 million a year for 4 years. Assume all cash flows are discounted at 11%.

If the company chooses to drill today, what is the project's net present value? A negative value should be entered with a negative sign. Enter your answer in millions.

Find the duration of a 7.6% coupon bond making semiannually coupon payments if it has three years until maturity and has a yield to maturity of 6.0%. What is the duration if the yield to maturity is 12.0%? Note: The face value of the bond is $100. (Do not round intermediate)

Kayla Sampson, an antiques dealer from Great Bend, Kansas, received her monthly billing statement for April for her MasterCard account. The statement indicated that she had a beginning balance of $600, on day 5 she charged $100, on day 12 she charged $300, and on day 15 she made a $200 payment. Out of curiosity, Kayla wanted to confirm that the finance charge for the billing cycle was correct (assume a 30-day month and that the card balance is actually reduced on the day the payment is made). What was Kayla's average daily balance for April without new purchases? Round your answer to the nearest dollar. Use rounded answer for later calculations.

What was her finance charge on the balance in part

(a) if her APR is 19.3 percent? Round your answer to the nearest cent.

$ What was her average daily balance for April with new purchases? Round your answer to the nearest dollar. Use rounded answer for later calculations.

$ What was her finance charge on the balance in part (c) if her APR is 19.3 percent? Round your answer to the nearest cent. $

The Collins Group, a leading producer of custom automobile accessories, has hired you to estimate the firm's weighted average cost of capital. The balance sheet and some other information are provided below.

The stock is currently selling for $15.25 per share, and its noncallable $1,000 par value, 20-year, 7.25% bonds with semiannual payments are selling for $875.00. The beta is 1.25, the yield on a 6-month Treasury bill is 3.50%, and the yield on a 20-year Treasury bond is 5.50%. The required return on the stock market is 11.50%, but the market has had an average annual return of 14.50% during the past 5 years. The firm's tax rate is 40%.

1. What is the best estimate of the after-tax cost of debt?

2. Based on the CAPM, what is the firm's cost of common stock?  

3. Which of the following is the best estimate for the weight of debt for use in calculating the firm's WACC?

4. What is the best estimate of the firm's WACC?

Colter Steel has $5,550,000 in assets. Temporary current assets $ 3,100,000 Permanent current assets 1,605,000 Fixed assets 845,000 Total assets $ 5,550,000 Short-term rates are 9 percent. Long-term rates are 14 percent. Earnings before interest and taxes are $1,170,000. The tax rate is 40 percent. If long-term financing is perfectly matched (synchronized) with long-term asset needs, and the same is true of short-term financing, what will earnings after taxes be?

Consider a project to supply 100 million postage stamps per year to Canada Post for the next five years. You have an idle parcel of land available that cost $850,000 five years ago; if you sold the land today, it would net you $1,080,000 after tax. If you sold the land five years from now, the land can be sold again for a net $1,150,000 after tax. You will need to install $4.6 million in new manufacturing plant and equipment to actually produce the stamps. The equipment qualifies for a CCA rate of 30% and can be sold for $400,000 at the end of the project. You will also need $600,000 in initial net working capital for the project, and an additional investment of $50,000 every year thereafter. Your production costs are 0.45 cents per stamp, and you have fixed costs of $1,200,000 per year. If your tax rate is 34% and your required return on this project is 12%, what bid price should you submit on the contract? Answer to 5 decimal places

1. Today is Joan's 30th birthday. Assume that she deposits $3,400 today and $3,400 on each of her birthdays until she turns 60 (when she makes the last deposit) into an account earning 6%. She plans to withdraw equal amounts each year from the time she turns 65 until she is 80. Each withdrawal is $______.

please use financial calculator!!!!

Trend Analysis & Ratio Analysis

Ratio analysis uses percentage or decimal calculations of comparison to at least two different sets of financial data using two industries. Comparing how one relates (compares) to another. Be sure to provide website

How much money can be withdrawn each month for the next 20 years from an account containing $250,000 if the account is paying 4% compounded monthly?

You have been asked to forecast the additional funds needed (AFN) for Houston, Hargrove, & Worthington (HHW), which is planning its operation for the coming year. The firm is operating at full capacity. Data for use in the forecast are shown below. However, the CEO is concerned about the impact of a change in the payout ratio from the 10% that was used in the past to 25%, which the firm's investment bankers have recommended. Based on the AFN equation, by how much would the AFN for the coming year change if HHW increased the payout from 10% to the new and higher level? All dollars are in millions. Last year's sales = S0 $300.0 Last year's accounts payable $50.0 Sales growth rate = g 40% Last year's notes payable $15.0 Last year's total assets = A0* $500 Last year's accruals $20.0 Last year's profit margin = PM 20.0% Initial payout ratio 10.0% Select the correct answer a. $12.6 b. $10.6 c. $11.6 d. $9.6 e. $13.6

Assume that the net cash flow of a potential $7.25 million investment is $1.1 million in year 1, then $1.25 million in year 2, $1.4 million in year 3, $2.2 million in year 4 and year 5, and then sold at the end of year 5 for $850,000. Further assume that in each year cash flows (excluding initial investment) could be as much as $400,000 less than forecast, or $400,000 more than forecast. Suppose you assess the “low net cash flow” probability at 25 percent likely, the base (original) scenario at 50 percent likely, and the “high net cash flow” probability at 25 percent. The corporate cost of capital is 9 percent.

1. What is the worst case NPV? $ _____

- What is the best case NPV? $_____

-What is the expected NPV on the basis of the scenario analysis? $_______