A stock is currently trading for $38. The company has a price–earnings multiple of 10. There are 100 million shares outstanding. Your model indicates that the stock is actually worth $28. The company announces that it will use $350 million to repurchase shares.

1. After the repurchase, what is the value of the stock, according to your model? Do not round intermediate calculations. Round your answer to the nearest cent.

   $  

2. After the repurchase, what is the actual price–earnings multiple of the stock? Do not round intermediate calculations. Round your answer to two decimal places.

3. If the company had used the $350 million to pay a cash dividend instead of doing a repurchase, how would the value of the stock have changed, according to your model? Do not round intermediate calculations. Round your answer to the nearest cent.

   The market value of the stock is now $   .

4. If the company had used the $350 million to pay a cash dividend instead of doing a repurchase, what would be the actual price–earnings multiple after the dividend? Do not round intermediate calculations. Round your answer to two decimal places.

Micah is investing in the stocks of the company KNS. KNS just paid a dividend of $1 per share (D0 = 1). Micah expects the dividend growth rate to be -10% for Year One and 5% for Year Two. Afterwards, Micah believes the growth rate to be constant at g forever. Micah uses CAPM model to determine the discount rate (expected rate of return). And he calculates the following: E(rm) = 6%, rf = 1%, and βKNS = 0.6. (a) If g = 3%, what is Micah’s estimate of the current price using the Dividend Discount Model?

(b) Suppose that the current price of KNS is $120 and Micah decides to short sell 100 shares of KNS stock using margin. The initial margin requirement is 50%. How much does Micah have to deposit into the margin account?

(c) If the price goes up to $140 per share and the maintenance margin is 35%, will Micah receive a margin call?

(d) Suppose Micah receives a margin call under 2(c). What is the minimum amount of cash that Micah can use to bring the margin back to 35%?

(Computational) Applied Statistics
Problem 1: A noted medical researcher has suggested that a heart attack is less likely to occur among adults who actively participate in athletics. A random sample of 300 adults is obtained. Of that total, 100 are found to be athletically active. Within this group, 10 suffered heart attacks; among the 200 athletically inactive adults, 26 had suffered heart attacks.                   
a) Test the hypothesis that the proportion of adults who are active and sufferedheart attacks is different from the proportion of adults who are not active and suffered heart attacks.     
b) Construct a 95% confidence interval for the difference between the proportions of all active and inactive adults who suffered heart attacks.What can you conclude and why?

Problem 2: The data below refer to aluminum contents in soil at two different locations. Summary of the data is provided in the table below. You mayassume that the data are normally distributed.  
Location     n       sample mean    sample standard deviation
       1           5            2935                                235.7657
       2           4            2637                                741.8416
a) Give a 95% confidence interval for the mean aluminum contents at location 1.
b) Give a 95% confidence interval for the mean aluminum contents at location 2.
What are your conclusions from the confidence intervals in (a) and (b)and why?   
c) At , test H0 : =   versus H1 :   
d) Give the approximate p-value for the test in (c).
Problem 3: Nine students were randomly selected who had taken the TOEFL test twice. A researcher would like to test the claim that students who take the TOEFL test a second time score higher than their first test.
Student                            A       B       C        D       E        F       G      H     I
   First TOEFL Score         480   510   530   540   550   560   600   620 660
Second TOEFL Score    460   500   530   520   580   580   560 640 690
Test the claim using a level of significance of 0.05 and construct a 90% confidence interval for µd .
Problem 4: According to reported figures, the average price of used car nationally is $8,000 with a standard deviation of $4,500. A student at annajah national university wants to purchase a used car and wishes to find out if the average used car price in Nablus is less than the national average. The student collected figures on a random sample of 81 used car sales at dealerships across Nablus. The sample mean price was $7,100.
a) State the null and alternative hypotheses, compute the test statistic, find the p-value and what is your conclusion? Use α = 0.05.
b) If the actual mean of the prices is $7500, find the probability of type II error.
c) What value of n is necessary to ensure that β = 0.10 when α = 0.05 and the actual mean is $7500?
Good LuckDr. Ali Barakat

Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $22.65 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers—particularly those located on remote ranches that require considerable travel time. The owner’s daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below:

Resource consumption is distributed across the activities as follows:

Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on.

1. Prepare the first-stage allocation of costs to the activity cost pools.

2. Compute the activity rates for the activity cost pools.

3. The company recently completed a 600 square foot carpet-cleaning job at the Flying N Ranch—a 51-mile round-trip journey from the company’s offices in Bozeman. Compute the cost of this job using the activity-based costing system.

4. The revenue from the Flying N Ranch was $135.90 (600 square feet @ $22.65 per hundred square feet). Calculate the customer margin earned on this job.

If you need more information please ask the cheeg system says there is a bad word in it somewhere and I can't find it.

1.) The method of tree ring dating gave the following years A.D. for an archaeological excavation site. Assume that the population of x values has an approximately normal distribution.

(a) Use a calculator with mean and standard deviation keys to find the sample mean year x and sample standard deviation s. (Round your answers to the nearest whole number.)

(b) Find a 90% confidence interval for the mean of all tree ring dates from this archaeological site. (Round your answers to the nearest whole number.)

2.) How much does a sleeping bag cost? Let's say you want a sleeping bag that should keep you warm in temperatures from 20°F to 45°F. A random sample of prices ($) for sleeping bags in this temperature range is given below. Assume that the population of x values has an approximately normal distribution.

(a) Use a calculator with mean and sample standard deviation keys to find the sample mean price x and sample standard deviation s. (Round your answers to two decimal places.)

(b) Using the given data as representative of the population of prices of all summer sleeping bags, find a 90% confidence interval for the mean price μ of all summer sleeping bags. (Round your answers to two decimal places.)

3.) How much do wild mountain lions weigh? Adult wild mountain lions (18 months or older) captured and released for the first time in the San Andres Mountains gave the following weights (pounds):

Assume that the population of x values has an approximately normal distribution.

(a) Use a calculator with mean and sample standard deviation keys to find the sample mean weight x and sample standard deviation s. (Round your answers to one decimal place.)

(b) Find a 75% confidence interval for the population average weight μ of all adult mountain lions in the specified region. (Round your answers to one decimal place.)

1. What are the three main ways of assigning a probability?

2. List four possible outcomes needed to determine probabilities?

3. An experiment consists of three stages. There are three possible outcomes in the first stage, four possible outcomes in the second stage, and two possible outcomes in the third stage. What is the total number of outcomes?

4. A box has 12 balls. If 3 balls are randomly selected with replacement from the box, how many possible samples are there?

5. 3 students will be selected from a tutorial class of 25 students for lucky prize. First student will get $50, second student $30 and third gets $10, how many possible outcomes are there?

6. A box has 20 balls. If 5 balls are randomly selected without replacement from the box, how many possible samples are there?

7. What are 4 types of probabilities?

8. The probability that price of a Economics text book (A) will increase over next semester is 0.5 while probability that the price of an Accounting text book (B) will rise over the same period is 0.7. The probability that price of both text books will rise is 0.4.

Follow the 3 steps to get the answers of the following questions:

a) What is the probability that the price of the Economics text book will not rise over the next semester?

b) What is the probability that neither book price will rise?

c) Given that the price of the Accounting text book does not rise, what is the probability that the price of the Economics text book will rise?

d) Give your opinion and justify the answer that whether price rises for two text books are mutually exclusive or not?

9. Differentiate between Discrete Random Variable and Continuous Random Variable?

10. Classify the following in either Discrete Random Variable or Continuous Random Variable and state the reason for your answer:

1. X = the number of students attending lab on Monday

2. X = the number of teachers in Oxford

3. X = the weight of a new born baby

4. X = the average number of students passed their Mid term test in a random sample of 10 tutorial classes

11. What is the probability distribution of a random variable when the coin is tossed twice describing the number of heads that turn up? Show all the steps.

12. What are the four conditions for Binomial Experiment?

13. According to the records, 30% of the businesses in US does sponsor in large scale. Just this morning 10 businesses sponsored.

1. What is the expected number of businesses that sponsor?

2. What is the standard deviation of the number of businesses that sponsor?

Justin Barlow, wearing a white lab coat with FOY emblazoned on the left side, smiled broadly as he rang the bell to begin the day’s trading on NASDAQ. In a few hours, FOY (ticker: FOY) would commence trading, and he would be the CEO of a publicly traded firm.   He would also be a multi-millionaire, at least on paper. Looking back over the five years, Justin realized that he knew a lot more about biochemistry than business and finance. Thankfully, ITM had recruited seasoned professionals to serve as COO and CFO. Justin knew that he could never have gotten this far without Joe Init’s help and the support of his staff. Sure, Joe took a little more ownership at every financing stage (Justin now owned about 22% of the company), but Justin supposed that was just the cost of playing the game. One thing still puzzled him, however. For the last three weeks, he had been traveling around the country with staff from ITM and the investment banker, Platinum Baggs, to meet prospective investors. Demand for the stock was very high and every institutional investor that they visited made strong commitments to purchase shares at the IPO. Based in this information, they raised the offer price by $4 per share compared to the midpoint of the initial estimated price range ($17.50 - $19.50). Still, the investment banker estimated that the stock price would increase 30-35% on the first day of trading. Justin suggested that they further increase the price or the number of shares offered to raise more capital (and further increase his personal wealth), but Platinum argued strongly that they should not raise the price even higher. Justin did not understand why they insisted that he leave so much money on the table, but Joe Init did not seem to mind too much so. In the end, Justin decided that the investment bankers knew more about the IPO process than he did, so he agreed to an offer price of $22.50. The price of the stock at the close of first-day trading was $30.75.

Why would Platinum Baggs insist that FOY underprice the offer and leave money on the table?

Quantitative Problem: Rosnan Industries' 2018 and 2017 balance sheets and income statements are shown below.

What is the firm’s 2018 current ratio? Do not round intermediate calculations. Round your answer to two decimal places.

If the industry average debt-to-assets ratio is 30%, then Rosnan’s creditors have a -Select-smallerbiggerCorrect 1 of Item 3 cushion than indicated by the industry average.

What is the firm’s 2018 net profit margin? Do not round intermediate calculations. Round your answer to four decimal places.

%

If the industry average profit margin is 12%, then Rosnan’s lower than average debt-to-assets ratio might be one reason for its high profit margin.
-Select-TrueFalseCorrect 1 of Item 4

What is the firm’s 2018 price/earnings ratio? Do not round intermediate calculations. Round your answer to two decimal places.

Using the DuPont equation, what is the firm’s 2018 ROE? Do not round intermediate calculations. Round your answer to two decimal places.

%

QUESTION 3 The accountant hands to you the following pre-adjustment trial balance of JOU BOU ENTERPRISES: JOU BOU Trial balance on 28 February 20.4 Dr Cr R R Purchases 107 000 Administrative expenditure 28 400 Bank 101 500 Fuel 34 000 VAT input 5 000 VAT control 8 000 VAT output (VAT rate = 10%) 20 000 Debtors control 9 100 Land 150 000 Trademarks 20 000 Rental income 22 000 Capital ? 11 Drawings 30 500 Accrued depreciation – vehicle 21 000 Mortgage loan 120 000 Sales 200 000 Insurance 23 200 Vehicles 30 000 Inventory – 1/3/20.3 12 500 Allowance for credit losses 1 000 560 000 560 000 Additional information: 1. Allowance for credit losses must be adjusted to 10% of debtors. 2. Rental income amounts to R1 100 per month (VAT included). 3. The mortgage loan carries interest at a rate of 20%. The loan of R120 000 was made on 28 February 20.3 and must be repaid in equal capital instalments over six (6) years. The payment has already been made but no entries has been made. 4. After a stock-take was done, the following was found: Quantity Cost price 10kg Bags JOU BOU 100 R40 5kg Bags JOU BOU 100 R30 5. The entity has three (3) identical vehicles in use that were purchased on the same date. Depreciation is provided for on the straight line basis at 20% on the cost price. No depreciation has been provided yet, the current year. 6. One of the vehicles was hijacked in the city on the last day of the financial year. The insurance paid out R3 300, including 10% VAT. The transaction has not yet been accounted for. 7. Trademarks are written of on the straight line basis at R1 000 per annum. REQUIRED: Prepare the statement of financial position on 28 February 20.4 to comply with the requirements of IFRS and Companies Act. (notes are not required).