Consumer Reports provided extensive testing and ratings for more than 100 HDTVs. An overall score, based primarily on picture quality, was developed for each model. In general, a higher overall score indicates better performance. The following (hypothetical) data show the price and overall score for the ten 42-inch plasma televisions (Consumer Report data slightly changed here):

Brand Price (X) Score (Y)

Dell 2900 50

Hisense 2800 52

Hitachi 2700 45

JVC 3500 60

LG 3300 56

Maxent 2000 30

Panasonic 4200 68

Phillips 3100 56

Proview 2500 35

Samsung 3000 48

Use the above data to develop and estimated regression equation and interpret the coefficients. Compute Coefficient of Determination and correlation coefficient and show their relation. Interpret the explanatory power of the model. Estimate the overall score for a 42-inch plasma television with a price of $3400. Finally, test the significance of the slope coefficient. Answer all parts of the question and provide necessary interpretations.

10. Consumer Reports provided extensive testing and ratings for more than 100 HDTVs. An overall score, based primarily on picture quality, was developed for each model. In general, a higher overall score indicates better performance. The following (hypothetical) data show the price and overall score for the ten 42-inch plasma televisions (Consumer Report data slightly changed here):

Use the above data to develop and estimated regression equation and interpret the coefficients. Compute Coefficient of Determination and correlation coefficient and show their relation. Interpret the explanatory power of the model. Estimate the overall score for a 42-inch plasma television with a price of $3400. Finally, test the significance of the slope coefficient. (Note that you need to answer all parts of the question and provide necessary interpretations to get full points).

ABC Company is doing a project assessment and needs to know what it's weighted average cost of capital is for supporting its current operations. They will adjust it from there based on risk weighting the individual projects. The company has the following components to its capital structure:

A. Debt 3 Components:

$10,660,000 of long term bank debt at 6.75%.

$15,000,000 par value bonds at 4.75% with 15 year maturity and a sale price of 92% of par.

$8,750,000 par value bonds at 5.25% with an 8 year maturity and a sale price of 97% of par.

B. Preferred Stock is $17,600,000 in par value at $100 par value per share. Price per share is $111.75 and the annual payment is $4.20 per share.

C. Stock is selling for $52.85 per share and there are 1,150,000 shares outstanding. The company has a beta of 1.26, expected market premium of 8.2% and the risk free rate is 1.36.

1. Calculate the cost of debt.

2. Calculate the cost of preferred stock.

3. Calculate the cost of equity.

4. Calculate the weighted average cost of capital.

Henry is planning to purchase a Treasury bond with a coupon rate of 4.71% and face value of $100. The maturity date of the bond is 15 May 2033.

(a) If Henry purchased this bond on 3 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.12% p.a. compounded half-yearly.

(b) If Henry purchased this bond on 3 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.12% p.a. compounded half-yearly. Henry needs to pay 29.2% on coupon payment as tax payment and tax are paid immediately.

(c) If Henry purchased this bond on 3 May 2018, what is his purchase price (rounded to four decimal places)? Assume a yield rate of 3.12% p.a. compounded half-yearly. Henry needs to pay 29.2% on coupon payment and capital gain as tax payment. Assume that all tax payments are paid immediately.

Select one for C

a. 85.7825

b. 103.0011

c. 121.1105

d. 105.0407

Consumer Reports provided extensive testing and ratings for more than 100 HDTVs. An overall score, based primarily on picture quality, was developed for each model. In general, a higher overall score indicates better performance. The following (hypothetical) data show the price and overall score for the ten 42-inch plasma televisions (Consumer Report data slightly changed here): Brand Price (X) Score (Y) Dell 2900 51 Hisense 2800 49 Hitachi 2500 45 JVC 3800 60 LG 3300 58 Maxent 2000 30 Panasonic 4500 70 Phillips 3100 54 Proview 2300 35 Samsung 2800 48 Use the above data to develop and estimated regression equation and interpret the coefficients. Compute Coefficient of Determination and correlation coefficient and show their relation. Interpret the explanatory power of the model. Estimate the overall score for a 42-inch plasma television with a price of $3400. Finally, test the significance of the slope coefficient. (Note that you need to provide necessary interpretations to get full points).

Consumer Reports provided extensive testing and ratings for more than 100 HDTVs. An overall score, based primarily on picture quality, was developed for each model. In general, a higher overall score indicates better performance. The following (hypothetical) data show the price and overall score for the ten 42-inch plasma televisions (Consumer Report data slightly changed here):

Use the above data to develop and estimated regression equation and interpret the coefficients. Compute Coefficient of Determination and correlation coefficient and show their relation. Interpret the explanatory power of the model. Estimate the overall score for a 42-inch plasma television with a price of $4000. Finally, test the significance of the slope coefficient. (Note that you need to provide necessary interpretations to get full points).

Problem 19-17 EPS; options; convertible preferred; additional shares [LO19-4, 19-5, 19-6, 19-7, 19-8, 19-9]

On January 1, 2018, Tonge Industries had outstanding 460,000 common shares ($1 par) that originally sold for $25 per share, and 5,000 shares of 10% cumulative preferred stock ($100 par), convertible into 50,000 common shares.

On October 1, 2018, Tonge sold and issued an additional 12,000 shares of common stock at $35. At December 31, 2018, there were 21,000 incentive stock options outstanding, issued in 2017, and exercisable after one year for 21,000 shares of common stock at an exercise price of $32. The market price of the common stock at year-end was $50. During the year, the price of the common shares had averaged $42.

Net income was $600,000. The tax rate for the year was 40%.

Required:
Compute basic and diluted EPS for the year ended December 31, 2018. (Enter your answers in thousands.)
  

Question 2:

The following table provides earnings information about two companies, A Ltd and B Ltd:

You are also given two different abnormal returns in share price for the current year, -0.026 (i.e., - 2.6%) and -0.017 (i.e., -1.7%), which are calculated from market model equations for A Ltd and B Ltd.

Required:

a) Calculate the forecast error in earnings per share for the current year for both A Ltd and B Ltd

using the random walk model. Show your workings.

b) Referring to research evidence of the information theory and based on your answer in part (a) of this question, briefly explain which abnormal return in share price you should choose for A Ltd and which abnormal return in share price you should choose for B Ltd, respectively. Assume earnings is the only source of new information in the market.

74) When the price of perfume changes from $24 to $26, the quantity supplied increases from 100 jars to 150 jars. What is the elasticity of supply of perfume?
A) 25.0
B) 5.0
C) 0.04
D) 0.2
76) An 18 percent increase in the price of a small car results in a 10 percent increase in the quantity supplied. The price elasticity of supply is equal to
A) 0.75.
B) 0.40.
C) 1.80.
D) 0.55.
77) Which of the following statements is CORRECT?
A) A change in the quantity demanded means a shift in the demand curve.
B) A change in demand means a shift in the demand curve while change in the quantity demanded means a movement along the demand curve.
C) A change in demand means a movement along the demand curve.
D) A change in demand and change in quantity demanded means the same thing.
78) When Janet Yellen, Chair of the Federal Reserve, addresses Congress regarding the United States role in the world economy, she is discussing
A) incentives.
B) a mic-roeconomic topic.
C) scarcity.
D) a macroeconomic topic