The level of carbon monoxide air pollution in parts per million (ppm) is measured at an entrance ramp to interstate highway I-80 near Iowa City each day. Measurements from two different samples are summarized as follows:

Sample 1: n = 96 x¯ = 126.8 s = 140.2

Sample 2: n = 143 x¯ = 126.8 s = 140.2

Let µ = mean daily level of carbon monoxide pollution at the entrance ramp, in ppm •

Interval 1 is a 90% confidence interval for µ calculated from Sample 1.

Interval 2 is a 99% confidence interval for µ calculated from Sample 1.

Interval 3 is a 99% confidence interval for µ calculated from Sample 2.

4. Calculate Interval 1.

(a) (89.04, 164.56)

(b) (89.19, 164.41)

(c) (102.99, 150.61)

(d) (103.03, 150.57)

(e) (103.26, 150.34)

5. Calculate Interval 2.

(a) (89.04, 164.56)

(b) (89.19, 164.41)

(c) (102.99, 150.61)

(d) (103.03, 150.57)

(e) (103.26, 150.34)

6. Calculate Interval 3.

(a) (89.22, 164.38)

(b) (89.44, 164.16)

(c) (103.05, 150.55)

(d) (107.34, 146.26)

(e) None of the answers is correct to the second decimal place

Airnova Inc. has two types of bonds, Bond D and Bond F. Both have 8 percent coupons, make semiannual payments, and are priced at par value. Bond D has 2 years to maturity. Bond F has 15 years to maturity.

Airnova Inc. is considering four different types of stocks. They each have a required return of 20 percent and a dividend of $3.75 for share. Stocks, A, B, and C are expected to maintain constant growth rates in dividends for the near future of 10 percent, 0 percent, and -5 percent, respectively. Stock D is a growth stock and will increase its dividend by 30 percent for the next four years and then maintain a constant 12 percent growth rate after that.

Discuss

If interest rates suddenly rise by 2 percent, what is the percentage change in both bonds?

If interest rates suddenly fall by 2 percent, what is the percentage change in both bonds?

What does this tell you about the interest rate risk of longer-term bonds?

What is the dividend yield for each of the four stocks?

What is the expected capital gains yield?

Discuss the relationship among the various returns that you find for each of the stocks.

A transparent cylindrical tube with radius r = 1.50 cm has a flat circular bottom and a top that is convex as seen from above, with radius of curvature of magnitude 2.60 cm. The cylinder is filled with quinoline, a colorless highly refractive liquid with index of refraction n = 1.627. Near the bottom of the tube, immersed in the liquid, is a luminescent LED display mounted on a platform whose height may be varied. The display is the letter A inside a circle that has a diameter of 1.05 cm. A real image of this display is formed at a height s′ above the top of the tube, as shown in

What is the minimum tube height H for which this display apparatus can function? Express your answer with the appropriate units.

The luminescent object is moved up and down periodically so that the real image moves up and down in the air above the tube. A mist in the air renders this display visible and dramatic. If we want the image to move from 60.0 cm above the top of the cylinder to 1.00 m above the top of the cylinder during this motion, what is the corresponding range of motion for the object distance s? Find the minimum value of s. Express your answer with the appropriate units.

Find the maximum value of s. Express your answer with the appropriate units.

Exercise 1:

Assume you have the following data about a country. Use the information and formulas in chapter 9 and the chapter 9 study guide to fill in the table below.

(Note: these are actual data, except the rate of economic growth. Rate of economic growth data are roughly US’s average from the past (3%) and China’s projected growth rate in the near future. Are these good assumptions to use?)

Can you see why standards of living in China are rapidly increasing? Which number shows this the best?

About how long will it be before China’s economy becomes larger than the U.S.’s?

Airnova Inc. has two types of bonds, Bond D and Bond F. Both have 8 percent coupons, make semiannual payments, and are priced at par value. Bond D has 2 years to maturity. Bond F has 15 years to maturity.

Airnova Inc. is considering four different types of stocks. They each have a required return of 20 percent and a dividend of $3.75 for share. Stocks, A, B, and C are expected to maintain constant growth rates in dividends for the near future of 10 percent, 0 percent, and -5 percent, respectively. Stock D is a growth stock and will increase its dividend by 30 percent for the next four years and then maintain a constant 12 percent growth rate after that

Discuss

If interest rates suddenly rise by 2 percent, what is the percentage change in both bonds?

If interest rates suddenly fall by 2 percent, what is the percentage change in both bonds?

What does this tell you about the interest rate risk of longer-term bonds?

What is the dividend yield for each of the four stocks?

What is the expected capital gains yield?

Discuss the relationship among the various returns that you find for each of the stocks.

Problem 9-19
Corporate valuation

Barrett Industries invests a large sum of money in R&D; as a result, it retains and reinvests all of its earnings. In other words, Barrett does not pay any dividends, and it has no plans to pay dividends in the near future. A major pension fund is interested in purchasing Barrett's stock. The pension fund manager has estimated Barrett's free cash flows for the next 4 years as follows: $2 million, $6 million, $11 million, and $13 million. After the fourth year, free cash flow is projected to grow at a constant 8%. Barrett's WACC is 16%, the market value of its debt and preferred stock totals $52 million, and it has 16 million shares of common stock outstanding.

a. What is the present value of the free cash flows projected during the next 4 years? Round your answer to the nearest cent.

b. What is the firm's horizon, or continuing, value? Round your answer to the nearest cent.

c. What is the firm's total value today? Round your answer to the nearest cent.

d. What is an estimate of Barrett's price per share? Round your answer to the nearest cent.

Consider

Airnova Inc. has two types of bonds, Bond D and Bond F. Both have 8 percent coupons, make semiannual payments, and are priced at par value. Bond D has 2 years to maturity. Bond F has 15 years to maturity.

Airnova Inc. is considering four different types of stocks. They each have a required return of 20 percent and a dividend of $3.75 for share. Stocks, A, B, and C are expected to maintain constant growth rates in dividends for the near future of 10 percent, 0 percent, and -5 percent, respectively. Stock D is a growth stock and will increase its dividend by 30 percent for the next four years and then maintain a constant 12 percent growth rate after that.

Discuss

• If interest rates suddenly rise by 2 percent, what is the percentage change in both bonds?

• If interest rates suddenly fall by 2 percent, what is the percentage change in both bonds?

• What does this tell you about the interest rate risk of longer-term bonds?

• What is the dividend yield for each of the four stocks?

• What is the expected capital gains yield?

• Discuss the relationship among the various returns that you find for each of the stocks.

The figures show a hypothetical planetary system at two different times. The system has a star S and three planets, labeled A, B, and C. The table provides the mass of each body in the system, as well as their spatial coordinates (?,?) in their initial and final positions. The spatial coordinates of the bodies are given in Astronomical Units (AU). Body Mass (kg) Initital Position Final Position S ?S=2.0197×1030 (0,0) (?S,?S) A ?A=2.0735×1028 (0.3429,0) (0,−0.5335) B ?B=6.6485×1026 (0.5617,1.2553) (−1.5385,0) C ?C=8.4729×1027 (0,1.6711) (−0.8021,−0.6035) The initial velocity of the center of mass of the system is zero. Find the magnitude ?S of the star's displacement from the origin in its final position. An x y coordinate system. The star S is at the origin. Planet A lies on the positive x-axis. Planet B is in the first quadrant of the graph. Planet C lies on the positive y-axis. Initial Position An x y coordinate system. The star S is near the origin in the first quadrant. Planet A lies on the negative y axis. Planet B lies on the negative x axis. Planet C is in the third quadrant of the graph. Final Position ?S= AU

Company ABC has just announced earnings of $2 per share. Based on the last five years, earnings have grown at a rate of 20% per annum and the company expects this to continue for the next five years, after which it expects earnings to remain constant forever. The company has a policy of paying out 30% of its earnings as dividends. ABC stock has a beta of 1.2. The yield to maturity on 10-year government bonds is 2% and market risk premium is 10%.

(a) Calculate the current value per share.

(b) If the stock is currently trading in the market at $10 per share, comment on whether any profits can be made. What form of market efficiency prevails if this occurs? Examine the other two (2) forms of market efficiency and what the observation on the stock price here implies in terms of market efficiency.

(c) The company plans to issue a 7-year bond in the near future to finance expansion into neighbouring countries. It expects interest rates to fall in 3 years’ time. State and describe two (2) possible types of bonds the company could issue. Analyse how the company can determine the pricing for its bond issue?

Airnova Inc. has two types of bonds, Bond D and Bond F. Both have 8 percent coupons, make semiannual payments, and are priced at par value. Bond D has 2 years to maturity. Bond F has 15 years to maturity.

Airnova Inc. is considering four different types of stocks. They each have a required return of 20 percent and a dividend of $3.75 for share. Stocks, A, B, and C are expected to maintain constant growth rates in dividends for the near future of 10 percent, 0 percent, and -5 percent, respectively. Stock D is a growth stock and will increase its dividend by 30 percent for the next four years and then maintain a constant 12 percent growth rate after that.

Discuss:

If interest rates suddenly rise by 2 percent, what is the percentage change in both bonds?

If interest rates suddenly fall by 2 percent, what is the percentage change in both bonds?

What does this tell you about the interest rate risk of longer-term bonds?

What is the dividend yield for each of the four stocks?

What is the expected capital gains yield?

Discuss the relationship among the various returns that you find for each of the stocks.