Assume you deposit $1,000 today in an account that pays 8 percent interest (compounded annually). How much will you have in four years? Group of answer choices $1,320 $1,360.50 $1,080 $735.02

Q: You are evaluating two stocks and trying to decide if they are undervalued or overvalued. You are…

A: Given: Particulars Stock 1 Stock 2 Price(P) 15 30 Dividend(d) 1 2 Dividend growth rate(g)…

Q: 8. Determine the amount that would have to be invested to provide 200 dollars interest at the end of…

A: Simple interest is the  quick and the straightforward way to calculate the interest on the loan.…

Q: a) The following Capital structure is extracted from Mirza Corporation Sdn Bhd a multinational…

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Q: . 1. How can microfinance institutions maintain their social mission of helping the poor whiles…

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Q: 1. Jeremiah has 3 years to repay a $55000 personal loan at 6.55% per year, compounded monthly. a.…

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Q: (a) Consider a portfolio with a Delta of 100, a Gamma of -20, and a Vega of -10. There are two…

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Q: Assume the company has no existing cash pre deal. LTM EBITDA at entry Entry and exit EV/EBITDA…

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Q: As one adds more assets to a portfolio in order to achieve diversification, the portfolio's risk? O…

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Q: Your friend signs a promissory note for $2,000 for 30 days with a rate of 2.25% attached. After…

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Q: Assume that Hogan Surgical Instruments Co. has $2,900,000 in assets. If it goes with a low-liquidity…

A: a. Most aggressive i.e. Low liquidity = assets * return rate = $2,900,000 * 17% = $493000

Q: QUESTION 2 1. You need $30,000 to buy a new Air-Con for your house in 4 years. What value you must…

A: Solution:- When an amount is invested somewhere, it earns interest on it. The amount initially…

Q: Assuming an interest rate of 5%, which three cash flows have the best Net Present Value? (Remember…

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Q: What is e Direct Investment?

A: Direct Investment is an important concept in the world of finance. Direct investment is also…

Q: For the below questions use these rates that your bank has quoted you: EUR/USD:        1.0175 –…

A: As per our guidelines, we are supposed to answer only 3 sub-parts (if there are multiple sub-parts…

Q: All stocks pay dividends, and therefore one can count on them having a dividend yield. OA. True OB.…

A: The company pays a part of its ptofit as Dividend and a part of profit is retained by the company…

Q: ( what is the maximum loan (P) you can. take out if you can afford $3800 quarterly payment for 13…

A: Quarterly Payment "PMT" is of $3800 Time period is 13 years Interest rate is 2.5% To Find: Maximum…

Q: For the below questions use these rates that your bank has quoted you: EUR/USD:        1.0175 –…

A: Solution:- Cross rate means the rate of two foreign currencies of which direct quote is not given.

Q: 1. Calculate the following expenses so that they are in monthly figures. Expense Amount ($) Water…

A: Amount of Quarterly Water expense is $150 Amount of Bi-monthly electricity expense is $114 To Find:…

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A: Since HST rate nor Province is provided, we are assuming an HST rate of 13% (Ontario). Cost of the…

Q: Assume the monthly payment of a loan amount of $400,000 is $1450. How long will it take to retire…

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Q: Describe how the Admati and Pfleiderer (1988) model differs from the Kyle (1985) model of equity…

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Q: 1. Latona Hitchens purchases 25 hanging file folders for $6.9

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Q: Suppose the discount rate is 10%. You bought a 10-year, 8% coupon bond with 7 years after it is…

A: Semiannual coupon amount (C) = $40 (i.e. $1000 * 0.08 / 2) Maturity value (MV) = $1000 (Equal to par…

Q: QUESTION 11 Use the formula A= P(1 + rt) to find the indicated quantity. Allan borrowed $5500 from…

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Q: In how many months will P10,000 earn a compound interest of P2,000 if money is worth 12% compounded…

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Q: You've observed the following returns on Pine Computer's stock over the past five years: 10 percent,…

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Q: Firm A has 10 shares. The present value (PV) of the firm is 500, i.e., 50 per share. It has an…

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Q: Over the last year, your holding period return on your investments has been 6.60%. Over the same…

A: To calculate the real after-tax return we will use the below formula   Real after tax return =…

Q: A company is analyzing two mutually exclusive projects, S and L, with the following cash flows:   0…

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A: Given: Cost of debt = 10% tax rate = 25%

Q: Krawczek Company will enter into a lease agreement with Heavy Equipment Co. where Krawczek will make…

A: Introduction  Operating leases require lease expenses to be recognized on a straight-line basis over…

Q: The Robinson Corporation has $33 million of bonds outstanding that were issued at a coupon rate of…

A: a. Discount rate = Revised interest rate * (1-tax rate)

Q: You have valued a business, using discounted cash flow models, at $250 million for a private sale.…

A: A) Introduction:- According to the idea of the regression coefficient, regression can take the form…

Q: Jesse borrowed from a bank at 5.92% compounded semi-annually; he settled the loan by repaying $3,055…

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Q: Hooper Chemical Company, a major chemical firm that uses such raw materials as carbon and petroleum…

A: To Find: Expected Value Standard Deviation Coefficient of Variation

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Q: They want to invest around $50,000 and they are expecting good growth in the next 5 years. As they…

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Q: Eastern Auto Parts Inc. has 20 percent of its sales paid for in cash and 80 percent on credit. All…

A: Solution:- Cash receipt budget is the budget prepared to forecast the upcoming cash receipts by the…

Q: What is the relationship between the price, coupon rate  and market yield?

A: The coupon rate is the bond's interest rate. The coupon rate is not the same as the market interest…

Q: Case: Two months ago, Lisa was honorably discharged from the Air Force where she spent four years…

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Q: Suppose your company needs $18 million to build a new assembly line. Your target debt- equity ratio…

A: weighted average flotation cost = floatation cost of debt * debt / (debt+equity) + floatation cost…

Q: The following data is reported for a fund and an appropriate benchmark as well as the risk-free rate…

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Q: ntermediate calculations and round your answers to 2 decimal places.) Year 1 2 3 4 5 6 Cash Flow .…

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Q: Pessimus stock's rate of return over the past 5 years was: 5%, -2%, 10%, 12%, -8%. What was its…

A: Return of year-1 = 5% Return of year-2 = -2% Return of year-3 = 10% Return of year-4 = 12% Return of…

Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.