Question
In: Finance
Caroline is considering an investment in Cate Enterprises (CE) or the one-year Treasury, which has a...
Caroline is considering an investment in Cate Enterprises (CE) or the one-year Treasury, which has a yield of 3%. CE has an average return of 15% with a standard deviation of 12%. Assuming the returns are normally distributed, what is the probability that CE will have a return greater than the Treasury security? Show work using Excel.
-EXPLAIN STEPS AND MEANING OF FORMULAS, PLEASE - ALSO HOW TO PUT INTO EXCEL.
Solutions
Expert Solution
SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE
I HAVE USING MANUAL CALCULATION, TAKING TABLE VALUE FROM TEXTBOOK
AS WELL AS EXCEL FUNCTION. THANK YOU. HAPPY TO HELP YOU
jeff jeffy answered 1 year agoRelated Solutions
1) The yield on a one-year Treasury security is 5.8400%, and thetwo-year Treasury security has...
1) The yield on a one-year Treasury security is 5.8400%, and the
two-year Treasury security has a 7.0080% yield. Assuming that the
pure expectations theory is correct, what is the market’s estimate
of the one-year Treasury rate one year from now? (Note: Do not
round your intermediate calculations.)
A. 10.3999%
B. 8.1889%
C.6.9606%
D. 9.3353%
2) Recall that on a one-year Treasury security the yield is
5.8400% and 7.0080% on a two-year Treasury security. Suppose the
one-year security does not...
B. J. Gautney Enterprises is evaluating a security. One-year Treasury bills are currently paying 4.6 percent.
(Expected rate of return and risk)B. J. Gautney Enterprises is evaluating a security. One-year
Treasury bills are currently paying 4.6 percent. Calculate the investment's expected return and its
standard deviation. Should Gautney invest in this security?ProbabilityReturn0.05−5%0.351%0.556%0.059%
You are considering an investment which has the following cash flows. If you require a 5 year...
You are considering an investment which has the following cash
flows. If you require a
5 year payback,
should you take the investment?
Year 0 1 2 3 4 5 6
Cash
flow
-$30,000 $10,000 $5,000 $5,000 $7,500 $10,000 $20,000
please show steps in excel
Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new three-year expansion
project that requires an initial fixed asset investment of $2.45
million. The fixed asset qualifies for 100 percent bonus
depreciation in the first year. The project is estimated to
generate $1,795,000 in annual sales, with costs of $688,000. The
project requires an initial investment in net working capital of
$420,000, and the fixed asset will have a market value of $435,000
at the end of the project.
a. if the tax rate...
Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new 3-year expansion project
that requires an initial fixed asset investment of $4.0 million.
The fixed asset falls into the 3-year MACRS class (MACRS Table) and
will have a market value of $310,800 after 3 years. The project
requires an initial investment in net working capital of $444,000.
The project is estimated to generate $3,552,000 in annual sales,
with costs of $1,420,800. The tax rate is 22 percent and the
required return on the project...
Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new three-year expansion
project that requires an initial fixed asset investment of $2.38
million. The fixed asset will be depreciated straight-line to zero
over its three-year tax life. The project is estimated to generate
$1,805,000 in annual sales, with costs of $715,000. The project
requires an initial investment in net working capital of $440,000,
and the fixed asset will have a market value of $465,000 at the end
of the project.
a.
If the tax...
Quad Enterprises is considering a new 4-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new 4-year expansion project
that requires an initial fixed asset investment of $2.322 million.
The fixed asset will be depreciated straight-line to zero over its
4-year tax life, after which time it will be worthless. The project
is estimated to generate $2,064,000 in annual sales, with costs of
$825,600.
If the tax rate is 25 percent, what is the OCF for this
project?
Multiple Choice
$493,425
$1,020,229
$1,127,621
$1,238,400
$1,073,925
Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new 3-year expansion project
that requires an initial fixed asset investment of $1.944 million.
The fixed asset will be depreciated straight-line to zero over its
3-year tax life, after which time it will have a market value of
$151,200. The project requires an initial investment in net working
capital of $216,000. The project is estimated to generate
$1,728,000 in annual sales, with costs of $691,200. The tax rate is
22 percent and the required return...
Quad Enterprises is considering a new 3-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new 3-year expansion project
that requires an initial fixed asset investment of $3.2 million.
The fixed asset falls into the 3-year MACRS class (MACRS Table) and
will have a market value of $247,800 after 3 years. The project
requires an initial investment in net working capital of $354,000.
The project is estimated to generate $2,832,000 in annual sales,
with costs of $1,132,800. The tax rate is 22 percent and the
required return on the project...
Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment...
Quad Enterprises is considering a new three-year expansion
project that requires an initial fixed asset investment of $2.54
million. The fixed asset will be depreciated straight-line to zero
over its three-year tax life and is estimated to have a market
value of $272,248 at the end of the project. The project is
estimated to generate $2,107,507 in annual sales, with costs of
$829,726. The project requires an initial investment in net working
capital of $374,305. If the tax rate is...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Describe a time when someone did not really listen to or understand a point you were...
- Enumerations Create an advanced enumeration to represent months (JANUARY – DECEMBER) called enuMonths Add internal properties...
- What is the minimum size of the automorphism group of a simple directed graph having more...
- The birthday paradox says that the probability (chance) that two people in a room will have...
- #include <iostream> #include "lib.hpp" using namespace std; int main() { // declare the bool bool...
- Why do we compare means instead of individual scores? for comparing average SAT test scores across...
- NPV Your division is considering two projects with the following cash flows (in millions): 0...
ADVERTISEMENT