Consider the following information regarding the performance of a money manager in a recent month. The table represents the actual return of each sector of the manager’s portfolio in column 1, the fraction of the portfolio allocated to each sector in column 2, the benchmark or neutral sector allocations in column 3, and the returns of sector indices in column 4.

a-1. What was the manager’s return in the month? (Do not round intermediate calculations. Input all amounts as positive values. Round your answer to 2 decimal places.)

a-2. What was her overperformance or underperformance? (Do not round intermediate calculations. Input all amounts as positive values. Round your answer to 2 decimal places.)

b. What was the contribution of security selection to relative performance? (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.)

c. What was the contribution of asset allocation to relative performance? (Do not round intermediate calculations. Round your answer to 2 decimal places. Negative amount should be indicated by a minus sign.)

Consider the two (excess return) index-model regression results for stocks A and B. The risk-free rate over the period was 5%, and the market’s average return was 14%. Performance is measured using an index model regression on excess returns.

a. Calculate the following statistics for each stock: (Round your answers to 4 decimal places.)

Stock A & Stock B

i.Alpha

ii.Information ratio

iii.Sharpe ratio

iv.Treynor measure

The table lists the monthly total returns on Adobe Systems Inc. common stock and the market rates of return for a 24-month period. Observation Month Adobe rate of return (%) Market rate of return (%) 1 Aug 2014 3.83 4.18 2 Sep 2014 -3.77 -2.11 3 Oct 2014 1.34 2.74 4 Nov 2014 5.08 2.43 5 Dec 2014 -1.33 -0.01 6 Jan 2015 -3.54 -2.77 7 Feb 2015 12.79 5.78 8 Mar 2015 -6.52 -1.01 9 Apr 2015 2.87 0.42 10 May 2015 3.98 1.39 11 Jun 2015 2.43 -1.70 12 Jul 2015 1.21 1.65 13 Aug 2015 -4.17 -6.00 14 Sep 2015 4.65 -2.95 15 Oct 2015 7.83 7.86 16 Nov 2015 3.16 0.56 17 Dec 2015 2.71 -2.04 18 Jan 2016 -5.12 -5.67 19 Feb 2016 -4.47 -0.02 20 Mar 2016 10.16 7.03 21 Apr 2016 0.45 0.63 22 May 2016 5.57 1.79 23 Jun 2016 -3.70 0.23 24 Jul 2016 2.16 3.97 Estimate beta to two decimal places for Adobe based on this data. Hint: see Examples 16 and 17 in the lecture. 1.73 1.27 1.58 1.04 1.42

For the most recent fiscal year, book value of long-term debt at Schlumberger was $11962 million. The market value of this long-term debt is approximately equal to its book value. Schlumberger’s share price currently is $59.03. The company has 1,000 million shares outstanding. Managers at Schlumberger estimate that the yield to maturity on any new bonds issued by the company will be 8.46%. Schlumberger’s marginal tax rate would be 35%. Schlumberger’s beta is 0.89. Suppose that the expected return on the market portfolio is 8% and the risk-free rate is 2%. Assume that the company will not change its capital structure. Also assume that the business risk of the projects under consideration is about the same as the business risk of Schlumberger as a whole. What would Schlumberger’s after-tax WACC be, given this information? Do not round at intermediate steps in your calculation. Express your answer in percent. Round to two decimal places. Do not type the % symbol.

The difference between a Roth IRA and a traditional IRA is that in a Roth IRA taxes are paid on the income that is contributed but the withdrawals at retirement are tax-free. In a traditional IRA, however, the contributions reduce your taxable income, but the withdrawals at retirement are taxable. Assume you plan to devote $5,000 to retirement savings in each year. You will retire in 30 years and expect to live for an additional 20 years after retirement.

a. Assume the before-tax interest rate is 5%. What will be your after-tax 20-year retirement consumption stream if you choose to save in a traditional IRA? Assume your tax rate is fixed at 30%. (Round your answers to 2 decimal place.)

b. What will be your 20-year retirement consumption stream if you choose to save in a Roth IRA? (Round your answers to 2 decimal place.)

c. Which provides better expected results if you expect your tax rate to decrease from 30% today to 25% at retirement?

• Traditional IRA

• Roth IRA

In 175 words or more, explain how to manage cultural risks and other factors related to a foreign operation of a multinational business. Is cultural, business, or political risk more challenging to overcome than one of the others? Why or why not? How should American standards influence multinational businesses? Thanks in advance

Brandtly Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Brandtly does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is interested in purchasing Brandtly's stock. The pension fund manager has estimated Brandtly's free cash flows for the next 4 years as follows: $2 million, $6 million, $8 million, and $15 million. After the fourth year, free cash flow is projected to grow at a constant 7%. Brandtly's WACC is 9%, the market value of its debt and preferred stock totals $54 million; and it has 12 million shares of common stock outstanding.

Write out your answers completely. For example, 13 million should be entered as 13,000,000.

1. What is the present value of the free cash flows projected during the next 4 years? Round your answer to the nearest cent. Do not round your intermediate calculations.
   
   $
2. 
   
3. What is the firm's horizon, or continuing, value? Round your answer to the nearest cent.
   
   $
4. 
   
5. What is the firm's total value today? Round your answer to the nearest cent. Do not round your intermediate calculations.
   
   $
6. 
   
7. What is an estimate of Brandtly's price per share? Round your answer to the nearest cent. Do not round your intermediate calculations

You want to make a one-year investment in a fixed-income security. You have two investment choices: a Treasury security and a Treasury inflation-protected security (TIPS). The nominal interest rate for the Treasury security is 4% and TIPS promises 1% real interest rate. You use scenario analysis to compare two securities. There are two possible scenarios with equal probabilities: High inflation and low inflation. The inflation rate will be 0% in the low state and 6.1% in the high state. (Do not use % approximation by adding or subtracting)

(a) Compute nominal and real realized returns for each asset with respect to each inflation scenario, and calculate expected return of each asset. (Round to the nearest tenth)

Nominal Returns Before Taxes

Real Returns Before Taxes

b) According to (a), which security will investors choose?

c) Now suppose the investor is subject to tax with marginal tax rate 40%. Compute nominal and real realized returns for each asset with respect to each inflation scenario, and calculate expected return of each asset. (Round to the nearest tenth)

Nominal Returns Before Taxes

Real Returns After Taxes

(d) What security would the investor choose if the investor has to pay tax with marginal tax rate 40%?

e) Explain why expected return and risk of TIPS changed after taxes.

Assume that you contribute $260 per month to a retirement plan for 20 years. Then you are able to increase the contribution to $520 per month for another 30 years. Given a 7.2 percent interest rate, what is the value of your retirement plan after the 50 years?  

MS Corporation's balance sheet as of today is as follows:

The bonds have an 6.4% coupon rate, payable semiannually, and a par value of $1,000. They mature exactly 10 years from today. The yield to maturity is 12%, so the bonds now sell below par. What is the current market value of the firm's debt?

Bitcoin prices are highly volatile compared to other currencies… and in fact most types of other securities as well.

• Briefly outline reasons why Bitcoin may be considered unusually risky. Feel free to add any quotes or data to support your thinking.

• Summarize how regulators (US or international) are considering getting involved.

1          A renewable energy electricity supply technology has the following characteristics:

1. If the owner can sell the electricity at 30 c/kWh,
2. 1. calculate the lifecycle cost of the technology over an assessment period of 25 years at a real discount rate of 5%                                
   2. Calculate the average unit cost of the power in present value terms (in cents/kWh) supplied by the technology over its lifetime at this real discount rate.
3. 1. What is the Levelised Cost of Electricity (LCOE) (in cents/kWh) for this case, with a salvage value of zero, and calculated using method 1 (that is, finding the constant price to charge for the electricity that gives a zero NPV at a real discount rate of 5% over 25 years)?
   2. Calculate this LCOE (add annualised capital cost to the annual operating cost, and divide by annual electricity supplied), and show that this gives the same value as method 1. Give values for the annualised capital cost and annual operating cost in your answer. (The annualised capital cost formula is the inverse of the Uniform Series Present Worth Factor formula.)

4. Using the figures in the table above as a baseline, work out an expression for Present Worth with real discount rate, assessment period, salvage value, and electricity price as independent variables. Then changing just one variable at a time (other things being kept equal) plot graphs of Present Worth versus each of these variables. Use a range of assessment periods up to the lifetime of the technology. Explore the effects of both positive and negative salvage values.

Note: to simplify the calculation of present worth, for assessment periods less than the lifetime, neglect the residual value of the technology, and assume salvage values are only incurred at the end of the lifetime of the technology.

I would appreciate if you can solve any part of this question.

Carlton Co. is considering adding a robotic paint sprayer to its production line. The sprayer's base price is $1,110,000, and it would cost another $23,500 to install it. The machine falls into the MACRS 3-year class (the applicable MACRS depreciation rates are 33.33%, 44.45%, 14.81%, and 7.41%), and it would be sold after 3 years for $654,000. The machine would require an increase in net working capital (inventory) of $9,000. The sprayer would not change revenues, but it is expected to save the firm $390,000 per year in before-tax operating costs, mainly labor. Campbell's marginal tax rate is 30%.

1. What is the Year 0 net cash flow?
   $
2. 
   
3. 
   
4. 
   
5. What are the net operating cash flows in Years 1, 2, and 3? Do not round intermediate calculations. Round your answers to the nearest dollar.

   Year 1	$
   Year 2	$
   Year 3	$

6. 
   
7. What is the additional Year 3 cash flow (i.e, the after-tax salvage and the return of working capital)? Do not round intermediate calculations. Round your answer to the nearest dollar.
   $
8. 
   
9. 
   
10. 
    
11. If the project's cost of capital is 10 %, what is the NPV of the project? Do not round intermediate calculations. Round your answer to the nearest dollar.
    $
    
    Should the machine be purchased?
    -Select-Yes/No

) Briefly explain how product costs are viewed on a flow-of-activity basis.

What will decrease these account items – Debit or Credit? Fill in the blanks. Liabilities __________ Expenses __________ Gains _____________