Which of the following statements is true?

Multiple Choice

• The global bond market is about half the size of the global stock market.

• Bonds are a common form of equity financing.

• Bonds are generally traded “under-the-table.”

• The U.S. Treasury is the largest issuer of bonds.

Which one of the following foreign bonds is the actual name of bonds that are traded in the U.S.?

a Bulldog bond

b Shogun bond

c Take-your-money-and-run bond

d Yankee bond

e All of the above

f None of the above

How does the concept of specialization determined by comparative advantage based on constant or increasing opportunity costs compare to the concept of specialization with increasing returns to scale? What do these differences imply about the types of products that are be traded and the types of countries that participate in trade?

Suppose that it is 10:14 Monday morning, and the price of Microsoft stock is $17.80 per share, the company is currently paying a dividend of $0.50 per share this year, and its dividend is expected to grow at a rate of 7% per year. At 10:15, Microsoft releases new sales information that indicates that sales of its latest version of Windows have been much higher than expected, and the firm expects higher sales to continue into the future. This news causes you and other investors to revise upward your forecast of the growth rate of Microsoft’s annual dividend from 7% to 8%. At this higher growth rate, the present value of Microsoft’s future dividends rises from $17.80 to $27.

This was copied from a textbook, I want to know how they got to $27.

9A A personnel researcher has designed a questionnaire and she would like to estimate the average time to complete the questionnaire. Suppose she samples 100 employees and finds that the mean time to take the test is 27 minutes with a standard deviation of 4 minutes. Construct a 90% confidence interval for the mean time to complete the questionnaire. Also, write a short explanation about the findings to the human resources director of your company summarizing the results. – Use Excel for this analysis.

9B. For the problem in part A, the human resources director wants to know whether these is sufficient sample evidence to conclude that the average time to complete the questionnaire is not 27 minutes. Set up the hypotheses (in statistical terms) and, based only on the confidence interval you have constructed in part A, what would you conclude regarding the hypotheses?

H0 :

H1 :

Will improving customer service result in higher stock prices for the companies providing the better service? "When a company's satisfaction score has improved over the prior year's results and is above the national average (currently 75.7), studies show its shares have a good chance of outperforming the broad stock market in the long run." The following satisfaction scores of three companies for the 4th quarters of two previous years were obtained from the American Customer Satisfaction Index. Assume that the scores are based on a poll of 68 customers from each company. Because the polling has been done for several years, the standard deviation can be assumed to equal 8 points in each case.

Company Year 1 Score Year 2 Score

Rite Aid 74 78

Expedia 78 81

J.C. Penney 72 80

a. For Rite Aid, is the increase in the satisfaction score from year 1 to year 2 statistically significant? Use x= 0.05 and null hypothesis is h0: u1-u2 <=0 . What can you conclude?

z value (to 2 decimals)

p-value (to 4 decimals)

b. Can you conclude that the year 2 score for Rite Aid is above the national average of 75.7? Use x=0.05 and null hypothesis is . Enter negative value as negative number.

z value (to 2 decimals)

p-value (to 4 decimals)

c. For Expedia, is the increase from year 1 to year 2 statistically significant? Use and null hypothesis is .

z value (to 2 decimals)

p-value (to 4 decimals)

d. When conducting a hypothesis test with the values given for the standard deviation, sample size, and , how large must the increase from Year 1 to Year 2 be for it to be statistically significant? (to 2 decimals)

e. Use the result of part (d) to state whether the increase for J.C. Penney from year 1 to year 2 is statistically significant.

The increase () statistically significant.

On October 31, 2021, Blossom Company had a cash balance per books of $8,967. The bank statement on that date showed a balance of $10,150. A comparison of the statement with the Cash account revealed the following:

Calculate the balance per bank statement at June 30 and the unadjusted Cash balance per company records at June 30.
A) Prepare a bank reconciliation at June 30.

B) Prepare the necessary adjusting entries at June 30.

C) What balance would Pharoah Company report as cash in the current assets section of its balance sheet on June 30, 2021?

Question 3 [14] Consider the following prices and quantities:

1. Compute and interpret the Paasche’s Quantity Index number for the year 2012 with 2010 as the base year.                                                                                                           (7)

2. Compute and interpret the Laspeyres Price Index number for the year 2015 with 2012 as the base year

Using the Black/Scholes Option Pricing Model, calculate the value of the call option given:

S= 74;               X=70;               T=6 months;                   ^=.50;             Rf =10%

What is the intrinsic value of the call?

What stock price is necessary to break-even?

If volatility were to decrease, the value of the call would ___________?

If the exercise price would increase, the value of the call would ___________?

If the time to maturity were 3-months, the value of the call would ___________?

If the stock price were $62, the value of the call would _________?

What is the maximum value that a call can take? Why?