XYZ stock price and dividend history are as follows:

An investor buys three shares of XYZ at the beginning of 2015, buys another one shares at the beginning of 2016, sells one share at the beginning of 2017, and sells all three remaining shares at the beginning of 2018.

a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Do not round intermediate calculations. Round your answers to 2 decimal places.)

b-1. Prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2015, to January 1, 2018. (Negative amounts should be indicated by a minus sign.)

b-2. What is the dollar-weighted rate of return? (Hint: If your calculator cannot calculate internal rate of return, you will have to use a spreadsheet or trial and error.) (Negative value should be indicated by a minus sign. Round your answer to 4 decimal places.)

1) A project has the following cash flows:

Year 0 -$22,500, Year 1 $12,650, Year 2 $10,900, and Year 3 $6,500. What is the IRR of the project? Please round your answer to two decimal places.

2) Following question 1, suppose the cost of capital is 15%. Would you accept or reject the project according to the IRR criterion? Accept or Reject

3) Following questions 1 and 2, which of the following statements about the IRR rule is false?

- The IRR of the project would be higher if the cash flow in year 3 is increased to $7,500.

- The IRR of the project will remain the same as in question 1 even if the cost of capital is increased to 20%.

- The investment decision by the IRR rule will remain unchanged even if the cost of capital is increased to 20%.

- Both (B) and (C) are false.

4) OpenSeas Inc., is evaluating the purchase of a new cruise ship. The ship would cost $400 million today. OpenSeas expects annual cash flows from the new ship to be $70 million and these cash flows will last forever. The cost of capital is 16%. What is the IRR of the new cruise ship? Answer in unit of %

1. Consider the one-year interest rates known at the following dates:

year 0: 2%

year 1: 2.5

year 2: 3%

year 3: 3.5%

year 4: 4%

year 5: 4.5%

year 6: 5%

year 7: 5.5%

year 8: 6%

year 9: 6.5%

Using the Expectations Theory, find the interest rates of maturities 1 through 10. Use the arithmetic average method. What do they suggest about the shape of the yield curve?

You would like to borrow $245,000 using a 30-year, 1-year ARM indexed to the 1- year Treasury security with a 2.75 percent margin and 2/6 caps (2 percent per year and 6 percent lifetime). The initial interest rate on this loan is 2.75 percent. The lender is charging you 1.50 points and $1,200 in miscellaneous fees to close the loan.

a) What is the initial payment on this mortgage?

b) If the 1-year Treasury security is yielding 2.25 percent at the first adjustment date, what is your payment on this loan during the second year?

c) Suppose that the 1-year Treasury is yielding 2.75 percent at the second adjustment date. What is the new payment on this loan during the third year?

d) Assuming that you pay of the loan at the end of the third year, what yield did the lender earn on this loan?

XYZ's stock price and dividend history are as follows:

An investor buys three shares of XYZ at the beginning of 2016, buys another two shares at the beginning of 2017, sells one share at the beginning of 2018, and sells all four remaining shares at the beginning of 2019.

a. What are the arithmetic and geometric average time-weighted rates of return for the investor? (Round your year-by-year rates of return and final answer to 2 decimal places. Do not round other calculations.)

b. What is the dollar-weighted rate of return? (Hint: Carefully prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2016, to January 1, 2019. If your calculator cannot calculate internal rate of return, you will have to use trial and error.) (Round your answers to 4 decimal places. Negative amount should be indicated by a minus sign.)

XYZ stock price and dividend history are as follows: Year Beginning-of-Year Price Dividend Paid at Year-End 2015 $ 130 $ 5 2016 144 5 2017 120 5 2018 125 5 An investor buys six shares of XYZ at the beginning of 2015, buys another three shares at the beginning of 2016, sells one share at the beginning of 2017, and sells all eight remaining shares at the beginning of 2018. a. What are the arithmetic and geometric average time-weighted rates of return for the investor? Prepare a chart of cash flows for the four dates corresponding to the turns of the year for January 1, 2015, to January 1, 2018. What is the dollar-weighted rate of return? (Hint: If your calculator cannot calculate internal rate of return, you will have to use a spreadsheet or trial and error.)

A 30-year annuity will pay $10,000 per year, beginning a year from today (i.e., t=1). If the interest rate is 6% per year, compounded annually, for the first 15 years and 8% per year, compounded annually, for the subsequent 15 years, what is the present value of the annuity at t=0? What is the future value of the annuity at t=30?

you are given the following time line year 1 +2,000 year 2 +2,000 year 3 +2000 year 4 +500 year 5 +500 year 6 +500 what is the value of the cash flow stream today if the discount rate is 16%?

XYZ stock price and dividend history are as follows:

Year     Beginning-of-year Price       Dividend paid at Year-End

2010           $100                                $4

2011           $110                                $4

2012           $90                                  $4

2013           $95                                  $4

Compute the standard deviation of stock return.