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Question

A number cube is rolled three times. An outcome is represented by a string of the sort OEE (meaning an odd number on the first roll, an even number on the second roll, and an even number on the third roll). The 8 outcomes are listed in the table below. Note that each outcome has the same probability.

For each of the three events in the table, check the outcome(s) that are contained in the event. Then, in the last column, enter the probability of the event.

The earnings, dividends, and stock price of Shelby Inc. are expected to grow at 3% per year in the future. Shelby's common stock sells for $24.00 per share, its last dividend was $2.00, and the company will pay a dividend of $2.06 at the end of the current year.

1. Using the discounted cash flow approach, what is its cost of equity? Round your answer to two decimal places.
   %
   
2. If the firm's beta is 1.2, the risk-free rate is 4%, and the expected return on the market is 12%, then what would be the firm's cost of equity based on the CAPM approach? Round your answer to two decimal places.
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3. If the firm's bonds earn a return of 8%, then what would be your estimate of rs using the own-bond-yield-plus-judgmental-risk-premium approach? (Hint: Use the mid-point of the risk premium range.) Round your answer to two decimal places.
   %
   
4. On the basis of the results of parts a–c, what would be your estimate of Shelby's cost of equity? Assume Shelby values each approach equally. Round your answer to two decimal places.

The earnings, dividends, and stock price of Shelby Inc. are expected to grow at 8% per year in the future. Shelby's common stock sells for $25.50 per share, its last dividend was $1.50, and the company will pay a dividend of $1.62 at the end of the current year.

1. Using the discounted cash flow approach, what is its cost of equity? Round your answer to two decimal places.
   _______ %
   
2. If the firm's beta is 1.3, the risk-free rate is 4%, and the expected return on the market is 13%, then what would be the firm's cost of equity based on the CAPM approach? Round your answer to two decimal places.
   _______ %
   
3. If the firm's bonds earn a return of 10%, then what would be your estimate of r_s using the over-own-bond-yield-plus-judgmental-risk-premium approach? Round your answer to two decimal places. (Hint: Use the midpoint of the risk premium range.)
   _____ %
   
4. On the basis of the results of parts a through c, what would be your estimate of Shelby's cost of equity? Assume Shelby values each approach equally. Round your answer to two decimal places.
   ______ %

1. You know the true properties of the data so you can answer the two following questions: (and you do not need to know the Y values to answer)

Expected value= 0 Variance= 10

a. What is the true variance of beta hat 1?

b. What is the true variance of beta hat 2?

A 12.75 year maturity zero-coupon bond selling at a yield to maturity of 8% (effective annual yield) has convexity of 150.3 and modified duration of 11.81 years. A 30-year maturity 6% coupon bond making annual coupon payments also selling at a yield to maturity of 8% has nearly identical duration of 11.79 years, but considerably higher convexity of 231.2. Answer the following:

(a)I) Calculate the prices of these two bonds.

ii) do the same but this time assume the yield to maturity on both bonds decreases to 7%.

1. If you disagree with what everyone else in the group is saying, what should you do?
2. In this week’s notes, the seven steps of the reflective thinking method are provided. Choose a problem and outline how to solve the problem, using the seven steps.

1. define the problem
2. analyze the problem
3. establish criteria for evaluating a solution
4. generate possible solutions (brainstorming)
5. choose the best solution
6. implement the solution
7. evaluate the solution

IN C#

In 1954, Hans Luhn of IBM proposed an algorithm for validating credit card numbers. The algorithm is useful to determine whether a card number is entered correctly or whether a credit card is scanned correctly by a scanner. Credit card numbers are generated following this validity check, commonly known as the Luhn check or the Mod 10 check, which can be described as follows (for illustration, consider the card number 4388576018402626): 1. Double every second digit from right to left. If doubling of a digit results in a two-digit number, add up the two digits to get a single-digit number. 2. Now add all single-digit numbers from Step 1. 4 + 4 + 8 + 2 + 3 + 1 + 7 + 8 = 37 3. Add all digits in the odd places from right to left in the card number. 6 + 6 + 0 + 8 + 0 + 7 + 8 + 3 = 38 4. Sum the results from Step 2 and Step 3. 37 + 38 = 75 5. If the result from Step 4 is divisible by 10, the card number is valid; otherwise, it is invalid. For example, the number 4388576018402626 is invalid, but the number 4388576018410707 is valid. Write a program that prompts the user to enter a credit card number as a long integer. Display whether the number is valid or invalid. Design your program to use the following methods: Use STRING as an input. Add methods

The Solomon Company uses a job costing system at its Dover, Delaware plant. The plant has a machining department. Its job costing system has two direct cost categories (direct materials and direct manufacturing labour) and two manufacturing overhead cost pools (the machining department, allocated using machine hours and the finishing department, allocated using manufacturing labour costs). The 2002 budget for the plant is

                                                              Machining Dept.                                       Finishing Dept.

Manufacturing overhead                                            $10,000,000                                                        $8,000,000          

Direct manufacturing labour cost                              $900,000                                                              $4,000,000

Direct Manufacturing labour hours                          30,000                                                                   160,000

What is the budgeted overhead rate that should be used in the machining department? In the finishing department?

During the month of January, the cost record for job 431 shows the following:

                                                                                    Machining department                             Finishing Dept.                                                                                                                                                                                                                 

Direct materials used                                                     $14000                                   $3000

Direct manufacturing labour costs                            $600                                             $1250

Direct manufacturing labour hours                          30                                                  50

Machine hours                                                                  130                                          10

What is the total manufacturing overhead allocated to job 431?

Assume that job 431 consisted of 20 units of product, what is the unit product cost?

Balances at the end of 2002 are as follows:

Machining Dept.Finishing Dept.

Manufacturing overhead incurred $11,200,000$7,900,000

Direct manufacturing labour costs$950,000$4,100,000

Machine hours220,00032,000

Compute the manufacturing overhead variance for each department and for the Dover plant as a whole.