2. Suppose there are 2 firms in a market. They face an aggregate demand curve, P=400-.75Q. Each firm has a Cost Function, TC=750+4q (MC=4).

c. Suppose instead that firm A is a Stackelberg leader and gets to choose quantity first. Calculate each firm's best-response function. What is the Nash equilibrium level of production for each firm? What is the equilibrium price? What are the profits of each firm?

One of your first assignments as a financial analyst at Fidelity Investments is to value the stock of a company that has not paid any dividends. You know you can’t apply the dividend discount model, so you must turn to a different method of valuation. Luckily, you remember you can value a stock using the Price-Earnings or P-E ratio. Describe this method and explain how you would use it to value the stock

During its first year of operations, Motorola Company paid $11,860 for direct materials and $10,900 for production workers' wages. Lease payments and utilities on the production facilities amounted to $9,900 while general, selling, and administrative expenses totaled $3,600. The company produced 7,100 units and sold 4,400 units at a price of $7.10 a unit.

What is Motorola's cost of goods sold for the year?

A. $20,240

B. $26,360

C. $16,336

D. $32,660

Moody Farms just paid a dividend of $3.75 on its stock. The growth rate in dividends is expected to be a constant 5 percent per year indefinitely. Investors require a return of 13 percent for the first three years, a return of 11 percent for the next three years, and a return of 9 percent thereafter. What is the current share price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Buckstars Inc. is a rapidly growing exotic herb company. The firm expects to pay its first dividend of $3.60 per share 4 years from today and management then expects to grow the dividend at 29% for 3 years. As competition enters the market, dividend growth after that will drop to 5% forever. If the appropriate discount rate is 10%, what is the share price today?    Solve in excel and round your final answer to 2 decimal places.

Rob buys a ond at t=0. Par is $1000, Coupon is annually paid with 10% and the maturity is 6 years. He invests the first year coupon at 8% for a year and sells the bond shortly after he receives the second year coupon. At t=2 (time of sale) the bonds yield to maturity is 9.5%. If he earned an annualized return of 14% on this two year investment what is the purchase price of the bond at t 0

On February 18, 2018, Union Corporation purchased $1,976,000 of IBM bonds. Union will hold the bonds indefinitely, and may sell them if their price increases sufficiently. On December 31, 2018, and December 31, 2019, the market value of the bonds was $1,924,000 and $2,002,000, respectively.

Required:
2. & 3. Prepare the adjusting entry for December 31, 2018 and 2019. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

A stock will pay no dividends for the next 3 years. Four years from now, the stock is expected to pay its first dividend in the amount of $2.1. It is expected to pay a dividend of $2.9 exactly five years from now. The dividend is expected to grow at a rate of 7% per year forever after that point. The required return on the stock is 12%. The stock's estimated price per share exactly TWO years from now, P₂ , should be $______.

A company issues $680,000 of 5% bonds, due in 10 years, with interest payable semiannually on June 30 and December 31 each year.

Calculate the issue price of a bond and complete the first three rows of an amortization schedule when:

1. The market interest rate is 5% and the bonds issue at face amount.

2. The market interest rate is 4% and the bonds issue at a premium

3. The market interest rate is 6% and the bonds issue at a discount