You start saving $1,000 at the end of this year and increase your saving by 5% every year for 18 years. Your account earns 13%. How much will you have in your account in 18 years?
In: Finance
Suppose the YTM is 5% for a 20-year $1000 bond with a 7% coupon rate and annual coupon payments. Its bond price is $____.
Instruction: Type ONLY your numerical answer in the unit of dollars, NO $ sign, NO comma, and round to one decimal place. E.g., if your answer is $7,001.56, should type ONLY the number 7001.6, NEITHER 7,001.6, $7001.6, $7,001.6, NOR 7002. Otherwise, Blackboard will treat it as a wrong answer.
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The current cost of graduate school tuition is $18,093 per year. The cost of tuition is rising at 7% per year. You plan to attend graduate school for 3 years starting 2 years from now.
How much do you have to invest today if your savings account earns 3.90% APR compounded annually to just fund your tuition?
In: Finance
Calculate an approximation of the yield to maturity (using the current yield) of a
20-year coupon bond with face value of 10,000$ and coupon rate of 5% per year;
assume that its price today is 3,000$.
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Smith Construction, Inc. is expected to pay a $2.78 dividend next year. The dividend is expected to grow by 4% each year for the next three years. After that the company will never pay another dividend ever again. If your required return on the stock investment is 10%, what should the stock sell for today?
Group of answer choices
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There is a 30 year bond, which pays 6% per annum at the time that required rates are10%. We buy with the intention of selling it in 4 years at which time the required rate is 6%. How much do we sell it in 4 years, and how much do we buy it now?
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Derek will deposit $5,678.00 per year for 15.00 years into an account that earns 13.00%, The first deposit is made next year. He has $10,763.00 in his account today. How much will be in the account 38.00 years from today?
Answer format: Currency: Round to: 2 decimal places.
In: Finance
What is the present value of an ordinary annuity that pays $550 per year for 14 years at 3%? Assume annual compounding
|
$4,461 |
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$6,213 |
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$364 |
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$7,700 |
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$832 |
In: Finance
Your grandfather is retiring at the end of next year. He would like to ensure that his heirs receive payments of $8,100 a year forever, starting when he retires. If he can earn 7.1 percent annually, how much does your grandfather need to invest to produce the desired cash flow? (Round answer to 2 decimal places e.g. 15.25.)
Present value of investment
In: Finance
Rhodes Corporation: Income Statements for Year Ending
December 31
(Millions of Dollars)
| 2020 | 2019 | ||||
| Sales | $ | 12,000 | $ | 11,000 | |
| Operating costs excluding depreciation | 10,520 | 9,674 | |||
| Depreciation and amortization | 380 | 350 | |||
| Earnings before interest and taxes | $ | 1,100 | $ | 976 | |
| Less interest | 240 | 200 | |||
| Pre-tax income | $ | 860 | $ | 776 | |
| Taxes (25%) | 215 | 194 | |||
| Net income available to common stockholders | $ | 645 | $ | 582 | |
| Common dividends | $ | 205 | $ | 200 | |
Rhodes Corporation: Balance Sheets as of December 31 (Millions of Dollars)
| 2020 | 2019 | ||||
| Assets | |||||
| Cash | $ | 450 | $ | 400 | |
| Short-term investments | 110 | 100 | |||
| Accounts receivable | 2,750 | 2,500 | |||
| Inventories | 1,350 | 1,200 | |||
| Total current assets | $ | 4,660 | $ | 4,200 | |
| Net plant and equipment | 3,750 | 3,500 | |||
| Total assets | $ | 8,410 | $ | 7,700 | |
| Liabilities and Equity | |||||
| Accounts payable | $ | 900 | $ | 800 | |
| Accruals | 450 | 400 | |||
| Notes payable | 356 | 200 | |||
| Total current liabilities | $ | 1,706 | $ | 1,400 | |
| Long-term debt | 900 | 800 | |||
| Total liabilities | $ | 2,606 | 2,200 | ||
| Common stock | 4,164 | 4,300 | |||
| Retained earnings | 1,640 | 1,200 | |||
| Total common equity | $ | 5,804 | $ | 5,500 | |
| Total liabilities and equity | $ | 8,410 | $ | 7,700 | |
Suppose the federal-plus-state tax corporate tax is 25%. Answer the following questions.
net operating profit after taxes (NOPAT) for 2020 is 825million
amounts of net operating working capital for both years: 3200million (2020), 2900million (2019)
amounts of total net operating capital for both years: 6950million (2020), 6400million (2019)
a, What is the free cash flow for 2020? Enter your answer in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Cash outflow, if any, should be indicated by a minus sign. Round your answer to the nearest whole number.
$ _____ million
b, What is the ROIC for 2020? Round your answer to two decimal places.
___ %
c, How much of the FCF did Rhodes use for each of the following purposes: after-tax interest, net debt repayments, dividends, net stock repurchases, and net purchases of short-term investments? (Hint: Remember that a net use can be negative.) Enter your answers in millions. For example, an answer of $1 million should be entered as 1, not 1,000,000. Round your answers to the nearest whole number.
| After-tax interest payment | $ million |
| Reduction (increase) in debt | $ million |
| Payment of dividends | $ million |
| Repurchase (Issue) stock | $ million |
| Purchase (Sale) of short-term investments | $ million |
In: Finance