a. A 10-year 5% coupon bond has a yield of 8% and a duration of 7.85 years. If the bond yield increases by 60 basis points, what is the percentage change in the bond price?

b. Alpha Insurance Company is obligated to make payments of $2 million, $3 million, and $4 million at the end of the next three years, respectively. The market interest rate is 8% per annum.

i. Determine the duration of the company’s payment obligations.

ii. Suppose the company’s payment obligations are fully funded and immunized using both 6-month zero coupon bonds and perpetuities. Determine how much of each of these bonds the company will hold in the portfolio.

I would like to know the answer of question bi and bii.

Garden Depot is a retailer that is preparing its budget for the upcoming fiscal year. Management has prepared the following summary of its budgeted cash flows:

The company’s beginning cash balance for the upcoming fiscal year will be $26,000. The company requires a minimum cash balance of $10,000 and may borrow any amount needed from a local bank at a quarterly interest rate of 3%. The company may borrow any amount at the beginning of any quarter and may repay its loans, or any part of its loans, at the end of any quarter. Interest payments are due on any principal at the time it is repaid. For simplicity, assume that interest is not compounded.

Required:

Prepare the company’s cash budget for the upcoming fiscal year. (Cash deficiency, repayments and interest should be indicated by a minus sign.)

Waterways Corporation is preparing its budget for the coming year, 2020. The first step is to plan for the first quarter of that coming year. The company has gathered information from its managers in preparation of the budgeting process.

Waterways likes to keep 10% of the next month’s unit sales in ending inventory. All sales are on account. 85% of the Accounts Receivable are collected in the month of sale, and 15% of the Accounts Receivable are collected in the month after sale. Accounts receivable on December 31, 2019, totaled $185,400.

Direct Materials

Direct materials cost 80 cents per pound. Two pounds of direct materials are required to produce each unit.

Waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Raw Materials on December 31, 2019, totaled 11,380 pounds. Payment for materials is made within 15 days. 50% is paid in the month of purchase, and 50% is paid in the month after purchase. Accounts Payable on December 31, 2019, totaled $104,585.

Other Information

The Cash balance on December 31, 2019, totaled $100,000, but management has decided it would like to maintain a cash balance of at least $700,000 beginning on January 31, 2020. Dividends are paid each month at the rate of $2.70 per share for 5,180 shares outstanding. The company has an open line of

1) For the first quarter of 2017, prepare a sales budget.

2) For the first quarter of 2017, prepare a production budget.

3) For the first quarter of 2017, prepare a direct materials budget. (Round cost per pound to 2 decimal places, e.g. 0.25 and all other answers to 0 decimal places, e.g. 2,520.)

4) For the first quarter of 2017, prepare a direct labor budget. (Round time per unit to nearest hour, e.g. 30 minutes will be rounded to 0.5 hours)

5) For the first quarter of 2017, prepare a manufacturing overhead budget. (Round overhead rate to 2 decimal places, e.g. 5.25 and all other answers to 0 decimal places, e.g. 2,520. List Variable Costs first.)

6)  For the first quarter of 2017, prepare a selling and administrative budget. (Enter per unit expenses rounded to 2 decimal places. E.g. 1.25)

7) For the first quarter of 2017, prepare a schedule for expected cash collections from customers. (Do not leave any answer field blank. Enter 0 for amounts.)

8)For the first quarter of 2017, prepare a schedule for expected payments for materials purchases. (Round answers to 0 decimal places, e.g. 2,520. Do not leave any answer field blank. Enter 0 for amounts.)

9) For the first quarter of 2017, prepare a cash budget. (Round answers to 0 decimal places, e.g. 2,520. Do not leave any answer field blank. Enter 0 for amounts.)

credit with Romney’s Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 9% interest. Waterways borrows on the first day of the month and repays on the last day of the month. A $550,000 equipment purchase is planned for February.

The airport will have an effective gross income of $30 million over the next year and operating expenses that are 20% of effective gross income over the forecast horizon after being $10 million this year due to a major renovation. The effective gross income is expected to continue to grow at the rate of the local economy which is a steady 3.25%. A going-in cap rate based on some fairly stale comparables in this highly illiquid market is 6.75% and the going-out cap rate is forecast to be the same.

The seaport enjoyed $38 million in effective gross income last year but this will only grow at 1% a year due to deglobalization effects. Last year operating expenses were $9.5 million but they are expected to grow at the local rate of inflation of 7.5% which will decline linearly in time before hitting the central bank target of 2% (where it will remain thereafter) in 10 years time. The pension plan requires a 12% return on an asset like this and the going out cap rate is expected to be 9% when the host country has completed its industrialization and transition to a consumer economy.

Calculate the value of each of these properties but just as importantly your portfolio manager wants you to produce margins of error where you assume each going-out cap rate was off by 25%

1. Nike has a project that will produce cash flows $200 next year if the economy is strong and $50 if the economy is weak. Suppose the corporate tax rate is 0. The economy will be strong with probability 50%. Nike issued both debt and equity to raise funds out of this project as much as possible. Specifically, Nike raised $60 by issuing debt with a face value $80. So, the creditors will receive $80 in total if the economy is strong but receive only $50 if the economy is bad because Nike defaults in this case. Nike also raised $50 by issuing equity as much as possible. The market risk premium is 7% and the risk-free rate is 5%. The entrepreneur of Nike has no equity shares in her firm. Now, suppose there is another shoes company, New Balance. This firm also has a project that will produce $200 next year if the economy is strong and $50 if the economy is weak. But the entrepreneur of New Balance wants to raise only $40 by issuing debt to avoid the chance of default. Assuming issued at risk-free rate and face value of $42 on the debt. She also plans to issue equity to raise funds as much as possible out of her project.

1. Suppose investor A is a single investor of Nike, who holds all the bonds and equities issued by Nike. Also, suppose investor B is a single investor of New Balance. The payoffs to these two investors will be the same?
2. If yes, how much can New Balance raise from equity holders? Does the total amount of funds that can be raised depend on the default risk of a firm?
3. What’s the expected return of equity for New Balance? What’s the equity beta?
4. What’s the cost of capital of New Balance?

Given the following cash inflow at the end of each year, what is the future value of this cash flow at 3%, 10% and 18% interest rates at the end of year 7?

Year   Cash Inflow
1 $15,000
2 $22,000
3 $28,000
4 $0
5 $0
6 $0
7 $160,000

What is the future value of this cash flow at 3% interest rate at the end of year 7?

What is the future value of this cash flow at 10% interest rate at the end of year 7?

What is the future value of this cash flow at 18% interest rate at the end of year 7?

round to the nearest cent

Logan is a 7 year old boy who was taken to the hospital for possible overdose. After arriving and treatment it was determined that the boy took his mothers suboxone. She cannot account for her were abouts when he took the drug and does not know how much he took or how he got it. Since, he has been removed from the care of his mother and placed in the care of his grandmother (his dads mother). His father is incarcerated for drug possession and manufacturing drugs and has been for the majority of his life. His mother failed her drug screen for drugs not prescribed from DSS when they arrived to the hospital. His mother is unemployed and cannot seem to hold a job. Logan and his mother live with his mothers grandmother, logans great grandmother. She is 80 years old. His great grandmother is the one who takes on all duties of parenting due to his mothers drug addiction. He sleeps with his great grandmother at night and she takes him to and from school and extracurricular activities. She fails to discipline him because he is stronger than her and she feels guilty because of his parents. Due to the fact that his mother lives in the home he has been placed out of the home with the closest relative.

Logan is suffering academically and acting out emotionally. He is not controlling his emotions and cries every morning after drop off. Logan responds positively to the assistant principal, who is a Male. He is able to calm Logan down and helps him one on one. He is having anger outbursts during class and refuses to participate in certain activities. He does not seem to have much of an appetite at school or at home. He has been bullying other kids at school and is also getting bullied because of his situation at home. His grandmother has set rules that she expects him to follow. She has created a chore chart for him and if he completes the tasks listed he gets rewarded. Logan is not use to this type of structure. He is struggling to complete simple tasks like making his bed in the morning and picking his clothes up out of the floor. This is all new to him because his great grandmother did everything.

Logans grandmother is trying to make a bad situation bearable, but she is struggling. She has been active in working with his caseworker, assistant principal and school counselors to try to find solutions to his behavior. His great grandmother is trying to stay involved and help without involving his mother in the process. She is also allowing supervised visits by the caseworker with his mother in hopes of reunification one day. At this point, nothing is working. Logan still seems emotionally unstable and is acting out. His teachers have reported that on the days of his visits with his mother, his behavior gets more aggressive. He does well when its library day for his class and is making strides reading, but suffering in all other areas.

I have to reply to the post above based off the criteria below. I am struggling quite a bit.

Use 1 theory from Chapter 1 (Freud, Erikson, Piaget, learning theory, bioecological theory, or nature vs. nurture). Demonstrate how the theory can help explain the presenting issue in the case.

From Chapters 2 and 3, identify 1 element of brain development, stress response, or cognitive development that is relevant to the case and explain why.

From Chapter 4, discuss the influence of parenting style or attachment in your classmates’ case.

Conclude by suggesting 1 environmental modification that would be useful as an intervention to this case.

The book required is The Life Span: Human Development for Helping Professionals 4th Edition Patricia C. Broderick

Assume that the 1-year zero-coupon bond is sold at $88.97 and the yields to maturity for the coupon bonds selling at market prices equal to their face values are 12% and 14% for 1-year and 1.5-year issues respectively. Coupons are paid every 6 months and face values are $100 for all the bonds.

(a) Calculate the spot rate curve (s_0.5, s₁, s_1.5).

(Keep your answer in decimal format 4 decimal places, e.g. 0.1234. Do not give in percent format e.g. 12.34%.)

     s_0.5:     s₁:      s_1.5 :

(b) Compute the quasi-modified duration for each of these bonds. (Keep 2 decimal places, e.g. xx.12.)

     Zero-coupon bond:

    12% coupon bond:  

    14% coupon bond:  

(c)  Determine the current price of an 10% coupon bond with face value $100 and 18 months to maturity. (Keep 2 decimal places, e.g. xx.12.)

Suppose Vince dies this year with a gross estate of $25 million and no adjusted prior gifts. Assume the estate qualifies for the martial deduction.

Calculate the amount of estate tax due (if any) under the following alternative conditions for 2018. (Refer to Exhibit 25-1 and Exhibit 25-2.)

Exhibit 25-2 The Exemption Equivalent

Year of Transfer                Gift Tax                 Estate Tax           

2018                                       11,180,000           11,180,000

Required:

1. Vince leaves his entire estate to his spouse, Millie.
2. Vince leaves $10 million to Millie and the remainder to charity.
3. Vince leaves $10 million to Millie and the remainder to his son, Paul.
4. Vince leaves $10 million to Millie and the remainder to a trust whose trustee is required to pay income to Millie for her life and the remainder to Paul(

For all requirements, enter your answer in millions rounded to 3 decimal places. Leave no answer blank. Enter zero if applicable.)

A. Amount of estate tax  

B. Amount of estate tax  

C. Amount of estate tax  

D. Amount of estate tax  

Assume that as of today, the annualized interest rate on a three-year security is 2 percent, while the annualized interest rate on a two-year security is 1.25 percent. Use this information to estimate the one-year forward rate two years from now.