1. Solve for Return of Risk Free Asset and its average Year Risk free rate (%) Inflation (%) Return risk-free asset 2011 4.51 3.00 ??? 2012 3.11 2.20 ??? 2013 2.61 2.70 ??? 2014 2.75 1.70 ??? 2015 2.34 1.70 ??? 2016 1.78 1.50 ??? 2017 1.77 1.90 ??? 2018 2.02 1.80 ??? 2019 0.90 1.80 ??? 2020 0.02 0.90 ??? Average 2.18%   ???

Q: Lauren deposited $10,000 today. He plans to withdraw $700 every year. For how long can she withdraw ...

A: Solution:- When an equal amount is withdrawn starting one period from now, it is called as ordinary ...

Q: A construction company agreed to lease payments of $649.32 on construction equipment to be made at t...

A: Lease agreement gives the right to use the assets during the given period by the payment of the peri...

Q: Melissa is glancing at this document that shows a financial summary of Cheesy Company's operations d...

A: Every company needs to prepare the financial statements for the financial year.

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Q: Explain the foreign currency swaps and why are they undertaken? Explain the functional currency and ...

A: A foreign currency swap, also known as an FX swap, is an agreement between two foreign parties to ex...

Q: An investor has two bonds in his portfolio that have a face value of $1,000 and pay an 11% annual co...

A: We need to calculate bond price by using excel PV function. The formula is =-PV(RATE,NPER,PMT,FV)

Q: A manufacturing company has provided the following cost data for a recent period: Direct materials ...

A: Solution:- We know, prime cost means the total direct cost incurred by the entity during its product...

Q: andez wishes to have $368,765 in a retirement account 15 years from now. What payment would Noime ha...

A: There is need of proper planning for the retirement and proper planning lead to have good money on r...

Q: analysis, determine which one of the three mutually exclusive alternativ should be selected. Each al...

A: Given First cost , Uniform annual benefit and Salvage value of device A,B & C.  

Q: If the probability of a recession is 0.3, normal growth is 0.4 and a boom is 0.3, and the payoff in ...

A: Probability Payoff 0.3 100 0.4 300 0.3 500

Q: How long will it take to save $2581.00 by making deposits of $227.00 at the end of every month into ...

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Q: Receive floating volatity during a to Selected period a Pay foxed volatit during a Fixed volatility ...

A: The cash flow refers to the net amount of cash and cash equivalents that are transferred in and out ...

Q: Bank pays 5 percent simple interest on its saving account, whereas Collar Bank pays 5 percent intere...

A: Simple interest is the interest on principal amount and no interest on interest but in the compounde...

Q: 1. Over the years, Masterson Corporation’s stockholders have provided $34,000,000 of  capital when t...

A: “Since you have asked multiple questions, we will solve the first question for you. If you want any ...

Q: Seven years ago the Templeton Company issued 15-year bonds with an 11% annual coupon rate at their $...

A: The return that investor can gets from keeping a bond in his portfolio till the issuer redeems it be...

Q: Usando un MARR de 12 % y presumiendo una vida útil de 10 años para las tres alternativas A , B y C ,...

A: Given: Particulars Amounts MARR 12% Years 10 Initial cost $150.00 Annual benefit $33.50

Q: You are able to sell 15 gallons of ghost pepper sauce per month at a price of $200 per gallon. Re- s...

A: Price per gallon (P) = $200 Number of gallons sold at price P (n) = 15 With every $9 reduction, 2 mo...

Q: This plant design, entitled “IIVSDROP: The First Ear Dropper Solution Manufacturing Plant in the Phi...

A: Initial Cost = PHP 550,320,000 Other Cost = PHP 27,000,000 Time Period = 30 Years Rate of return = 2...

Q: EncryptCo is considering a project with a $50,000 first cost that returns $12,000 per year. Assume t...

A: The Payback Period is the period of time it takes to return the cost of an original investment by th...

Q: There is a bank account with a balance of 10,000 dollars and an interest rate of 1% per year. How lo...

A: Solution:- Rule 72 calculates the approximate time for an investment to get double, under the given ...

Q: Assume that you start with a balance of $3600 on your credit card. During the first month, you charg...

A: Given Starting balance is $3600 First month charge is $400 Second month charge is $550

Q: A car loan of ​$37,412.98 is to be repaid with​ end-of-month payments of ​$725.06. If interest is 5​...

A: Loan amount (PV) = $37,412.98 Monthly payment (P) = $725.06 Interest rate = 5% Monthly interest rate...

Q: Suppose you buy GM put for P3, which matures in two months with a strike price of P60. GM is current...

A: Put option give the opportunity to sell the stock but no obligation to sell. Option give opportunity...

Q: Simon brothers has perpetual preferred stock outstanding that sells for $21.50 a share and pays a di...

A: Solution:- Preferred stock is hybrid form of common shares and bonds. They get a fixed dividend per ...

Q: Compute the IRR statistic for Project E. The appropriate cost of capital is 8 percent. (Do not round...

A: IRR refers to the Internal rate of return. It is the rate of return of a project at which the net pr...

Q: Is estate tax a type of debt? What happens if a person doesn't pay estate tax?

A: The estate tax is a tax imposed after a person's death on the transfer of property and other assets....

Q: The Aninem family has total assets of Php460,000 and total liabilities of Php186,000. Included in th...

A: Total assets = Php 460,000 Investment assets = Php 253,000

Q: Molly has made deposits of $960 at the end of every six months for twelve years. If interest is 5% c...

A: Semi annual deposit (P) = $960 Interest rate = 5% Semi annual interest rate (r) = [{1+(0.05/4)}4]1/2...

Q: Q 18-21: Let the current spot rate be 1.21 Sf/$. Let the exercise price be 1.20 $/€. Let the volatil...

A: Thanks for the Question: Bartleby's Guideline: “Since you have posted a question with multiple sub-p...

Q: Which one is the contractual equation for buying an FRA? a.) Loan with maturity t2 plus Deposit with...

A: FRA (Forward Rate Agreement) refers to personalised financial contracts that are traded Over the Cou...

Q: QUESTION 6 You receive a RM15,000 signing bonus from your new employer and decide to invest it for 2...

A: Comparison of both the alternatives shall be based on the future value under the said alternatives.

Q: Some job seekers approach prospective employers directly. This process is called Prospecting.

A: Prospecting is a process by which a firm's sales team can find prsopective client or a qualified pot...

Q: Let the current spot rate be 1.21 Sf/$. Let the exercise price be 1.20 $/€. Let the volatility of th...

A: Many Thanks for the Question. Bartleby's Guideline: “Since you have posted a question with multiple ...

Q: Present Value of an Annuity On January 1, you win $1,600,000 in the state lottery. The $1,600,000 p...

A: Present Value of an Annuity The amount of money you'd have to invest right now to equal the sum of a...

Q: A project has annual cash flows of $4,000 for the next 10 years and then $8,500 each year for the fo...

A: Calculate the Initial investment as follows: At IRR, the PV of cash inflows is equal to the initial ...

Q: Which of the following supply and demand graphs for bonds issued by Company X represents what happen...

A: Default risk is the risk when the issuer of the bond is not able to make timely interest or coupon p...

Q: Find the term of the ordinary annuity in years and months (from 0 to 11 months). Present Periodic Pa...

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Q: All are true about the corporate stocks except ... a. Represents ownership interest in a corporation...

A: Corporate stocks are a part/ fraction of ownership in a corporation .

Q: You are planning to save for retirement over the next 35 years. To do this you will invest $710 per ...

A: The assessment of a current asset at a date in the future predicated on an estimated rate of growth ...

Q: You invest in a 55 month $5,163 zero-coupon corporate bond at a simple discount rate of 9.73 per yea...

A: The price of a zero-coupon bond issued at discount is equal to the face value of the bond less the d...

Q: An annuity with a cash value of $14,000 earns 5% compounded semi-annually. End-of-period semi-annual...

A: Future value can be calculated using FV (rate, nper, pmt, [Pv], [type]) Rate The interest rate Nper...

Q: Assume you sell short 100 shares of GE at P69 in July. You buy a September P70 call for P3.50 to pro...

A: The gain or loss is call is calculated as sum of loss on short position and the gain in call option ...

Q: You are considering the purchase of CJ, Inc. bonds that mature in 13 years, and have a 4.75% coupon ...

A: Time to maturity is 13 years Coupon rate is 4.75% Par value is $1,000 Yield to maturity is 4.45% To ...

Q: Determine the future worth of P5000 at exact simple interest rate of 11% from January 12, to Oct. 5,...

A: Principal (P) = P 5000 r = 11% n = 267 days

Q: Terex company has a beta of 1.7 and is trying to calculate its cost of equity capital. If the risk -...

A: The cost of equity can be calculated by using CAPM formula based on risk premium and risk free rate.

Q: Calculate the amoùnt deposited one year ago to have $1,000 as a net benefit now at an interest rate ...

A: We have to calculate the amount deposited one year ago (present value).  

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A: Realized return Realized return is referred to as the actual return earned by the stock and is also ...

Q: Caty wanted to hedge her company exposure in commodity, stocks, interest rates and currencies on der...

A: a) In the Malaysian market, there are three types of derivatives: commodity derivatives (major commo...

Q: 40. Jim has earned an average of $3,290 per month over his lifetime. He is planning to retire at 66,...

A: Solution:- Retirement benefit means the amount of money payable to a person when he/she retires from...

Treasury Market

On-the-run securities are the most recently issued securities in the market depth and are therefore traded at some premium. The off-the-run securities are the ones issued just before the most recent ones. The on-the-run securities have a lower yield to the investor than the off-the-run securities.