Assume that as of today, the annualized interest rate on a three-year security is 2 percent, while the annualized interest rate on a two-year security is 1.25 percent. Use this information to estimate the one-year forward rate two years from now.

Jill purchased a share one year ago for $13.06. The share is now worth $15.26, and the total return to Jill for owning the share was 24.7 per cent. The dollar amount of dividends that she received for owning the share during the year is (expressed in dollars to the nearest cent; don't use $sign or commas eg 50 cents is 0.50)?

How is money supply measured and why? 

We will do one more quick retirement account analysis problem to see the impact of: (1) trying to save either a fixed amount each year or a constant percentage of your salary each year and (2) starting your retirement saving immediately or waiting 10 years to really start your retirement savings. Let’s assume that you put a savings deposit into your 401k account at the end of each year by saving money over that previous year period (i.e. so I normally think of them as beginning of year transactions for my cash flow table since I think of the “Period” column in my present value table as “time elapsed between time zero (e.g. today or whenever the cash flow table starts) and when the cash flow will take place.” (e.g. a cash flow in the row labelled “Period 1” occurs at the end of Year 0 or beginning of Year 1, so 1 years time has elapsed since “time 0”) Assume you graduate with your B.S. in Chemical Engineering in Spring semester 2023, take few months off to travel around Europe, and then start work in January 2024 with a starting salary of $70,000. You can also assume where it becomes important that you get an average yearly raise of 2% each year (i.e. so you make $70,000 your first year on the job, $71,400 your second year, etc.). Assume that you are going to retire 40 years later in January 2064. Assume that you are going to live the average of 20 years into retirement, i.e. that you will die in January 2084, and that you want to pay yourself $100,000 per year in retirement income each year, and that both while saving and throughout retirement that your 401k earns 7% in effective interest compounded yearly. Case 1: Using an NPV analysis and assuming that you want to completely expend your retirement savings right when you die (i.e. NPV=0 for the entire series of cash flows then in this case) and that you start saving with your first deposit at the end of 2024, how much would you have to save each year into your retirement account if you wanted to save the exact same amount each year? Case 2: Using an NPV analysis and assuming that you want to completely expend your retirement savings right when you die (i.e. NPV=0 for the entire series of cash flows then in this case) and that you start saving with your first deposit at the end of 2024, how much would you have to save each year on a percentage of your salary basis into your retirement account if you wanted to save the exact same percentage of your salary each year you are working (HINT: Here you may want to add a column to your cash flow table to track your yearly salary as it increase due to raises)? Case 3: Using an NPV analysis and assuming that you want to completely expend your retirement savings right when you die (i.e. NPV=0 for the entire series of cash flows then in this case) and that you have fun in your 20’s and early 30’s and wait to start saving with your first deposit at the end of 2034 (i.e. so now retirement is only 30 years after you start saving), how much would you have to save each year into your retirement account if you wanted to save the exact same amount each year? Write a short discussion of how you feel about your ability to achieve these types of retirement goals and savings and comment on the effect of waiting to start saving for retirement.

Calculate the future value of the following annuity streams:

a. $5,000 received each year for five years on the last day of each year if your investments pay 6 percent compounded annually.

b. $5,000 received each quarter for five years on the last day of each quarter if your investments pay 6 percent compounded quarterly.

c. $5,000 received each year for five years on the first day of each year if your investments pay 6 percent compounded annually.

d. $5,000 received each quarter for five years on the first day of each quarter if your investments pay 6 percent compounded quarterly.

You have been offered the opportunity to invest in a project that will pay $4,155 per year at the end of years one through three and $8,519 per year at the end of years four and five. These cash flows will be placed in a saving account that pays 18.89 percent per year. What is the future value of this cash flow pattern at the end of year five?

write a conclusion about a partnership business

-the advantages of doing a partnership company

-how's the management of the company run

1. Problem 3.01 (Balance Sheet) eBook Problem Walk-Through The assets of Dallas & Associates consist entirely of current assets and net plant and equipment, and the firm has no excess cash. The firm has total assets of $2.6 million and net plant and equipment equals $2.1 million. It has notes payable of $150,000, long-term debt of $759,000, and total common equity of $1.5 million. The firm does have accounts payable and accruals on its balance sheet. The firm only finances with debt and common equity, so it has no preferred stock on its balance sheet. Write out your answers completely. For example, 25 million should be entered as 25,000,000. Negative values, if any, should be indicated by a minus sign. Round your answers to the nearest dollar, if necessary. What is the company's total debt? $ What is the amount of total liabilities and equity that appears on the firm's balance sheet? $ What is the balance of current assets on the firm's balance sheet? $ What is the balance of current liabilities on the firm's balance sheet? $ What is the amount of accounts payable and accruals on its balance sheet? (Hint: Consider this as a single line item on the firm's balance sheet.) $ What is the firm's net working capital? If your answer is zero, enter "0". $ What is the firm's net operating working capital? $ What is the monetary difference between your answers to part f and g? $ What does this difference indicate?

11.2   Your rich uncle in France has decided to give you an annuity of €2,000 per month. Because you live in Canada, you’re concerned about the effect of foreign currency fluctuations on your new income. You heard a finance guy on the radio talking about how “foreign currency exchange rate could move against you, if you’re not properly prepared.”                                                                                              

a.    What does it mean for the currency exchange rate to move against you?

b.    Would moving to France mitigate some of the risk? If so, how? If not, why not?

c.     Assume you want to stay in Canada. Your grandparents, who have retired to Provence (France), each receive a Canadian pension of C$1100 monthly. What could you do to reduce the risk for all of you?

You have already saved $6850 to buy a used car. You invest this money in a certificate of deposit earning 0.30% APR compounded monthly. How many years will it take your account to reach your target of $7275 in order to buy the new car?

You expect a share of stock to pay dividends of $2.10, $2.35, and $2.60 in each of the next 3 years. You believe the stock will sell for $33.00 at the end of the third year.

a. What is the stock price if the discount rate for the stock is 20%? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

b. What is the dividend yield for year 1? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

c. What will be the dividend yield at the start of year 2? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

1. If markets are efficient, when new information about a stock becomes available, the price will:

a. remain unchanged because it already reflects this information.

b. accurately and rapidly adjust to include this new information.

c. adjust to accurately reflect this new information over the course of the next few days.

d. most likely increase because all new information has a positive effect on stock prices.

2. Which one of these is included in the yield of a bond with a low credit rating but not included in a U.S. Treasury bond yield? Assume both bonds are selling at a premium.

a. Real rate of return

b. Inflation premium

c. Default premium

d. Loss of premium

3. Market efficiency implies

a. that investors are irrational.

b. that there is no point to buying common stocks.

c. that consistently superior performance is very difficult even for professional investors.

d. that there are no taxes.

One year​ ago, your company purchased a machine used in manufacturing for $ 120, 000. You have learned that a new machine is available that offers many advantages and you can purchase it for $ 140, 000 today. It will be depreciated on a​ straight-line basis over 10 years and has no salvage value. You expect that the new machine will produce a gross margin​ (revenues minus operating expenses other than​ depreciation) of $ 60,000 per year for the next 10 years. The current machine is expected to produce a gross margin of $ 23,000 per year. The current machine is being depreciated on a​ straight-line basis over a useful life of 11​ years, and has no salvage​ value, so depreciation expense for the current machine is $ 10,909 per year. The market value today of the current machine is $ 45,000. Your​ company's tax rate is 45 %​, and the opportunity cost of capital for this type of equipment is 10 %. Should your company replace its​ year-old machine?

------------------------------------------

The NPV of replacing the​ year-old machine is (...) ​(Round to the nearest​ dollar.)

You are considering a project that will pay you $710 in the first year, $2,000 in the second year, and $1,090 in the third year. In the fourth year, the project will pay you a cash flow of 3,000, which starting from the fifth year will grow forever at a rate of 2%. If the interest rate for this project is 12%, and the time-zero cost of starting this project is $10,000, what is the Net Present Value (PV of benefits minus PV of costs) of the project? Round your answer to the first two decimal places.

1. On Jan 1, you sold short 400 shares of AT&T at $35 per share. You post $7000 to the margin account. On April 1, you received a margin call on this trade. Assume the minimum margin requirement is 40%, what is the price of the stock that triggered the margin call?

1. You are an investment advisor for Alan and Jimmy. You've helped them optimally allocate their investment portfolios along the same capital allocation line (CAL). If Alan's portfolio has a higher weight on risk-free asset than Jimmy's portfolio, then which of the following statements MUST be true:
   
   [I]   Alan’s portfolio has lower expected returns than Jimmy’s
   [II]  Alan is less risk-averse than Jimmy
   [III] Alan must hold a positive position in the risky asset

1. On January 1, you sold short 200 shares of Walt Disney Co at $150 per share and pledged 50% initial margin. On March 1, a dividend of $10 per share was paid. On June 1, you closed your position buying 200 shares at $170 per share. What is your rate of return?