Problems (p. 297)
7-2 Constant Growth Valuation
Boehm Incorporated is expected to pay $1.50 per share dividend at the end of this year (i.e., D (1) = $1.50). The dividend is expected to grow at a constant rate of 7% a year. The required rate of return on the stock, r(s), is 15%. What is the value per share of Boehm’s stock? 1.50 / (0.15 – 0.07) = $18.75

7-4 Preferred Stock Valuation
Nick’s Enchiladas Incorporated has preferred stock outstanding that pays a dividend of $5 at the end of each year. The preferred sells for $50 a share. What is the stock’s required rate of return? $5 / $50 = 10%

7-5 Non-constant Growth Valuation
A company currently pays a dividend of $2 per (D0= $2). It is estimated that the company's dividend will grow at a rate of 20% per year for the next 2 years, then at a constant rate of 7% thereafter. The company's stock has a beta of 1.2, the risk free rate is 7.5%, and the market risk is 4%. What is your estimate of the stock's current price? 7.5% + (4%) 1.2 = 12.3%

9-2 After-Tax Cost of Debt
LL Incorporated's currently outstanding 11% coupon bonds have a yield to maturity of 8%. LL believes it could issue at par new bonds that would provide a similar yield to maturity. If its marginal tax rate is 35%, what is LL's after-tax cost of debt? 0.08 (0.65) = 5.2%

9-4 Cost of Preferred Stock with Flotation Costs
Burnwood Tech plans to issue some $60 par preferred stock with a 6% dividend. A similar stock is selling on the market for $70. Burnwood must pay flotation costs of 5% of the issue price. What is the cost of the preferred stock? 60 x .06/70(1-0.05)

3.6/66.5
.0541= 5.41%
9-5 Cost of Equity - DCF
Summerdahl Resorts’ common stock is...

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MAT 540 Week4Homework
Chapter 15 problems
2. The manager of the Carpet City outlet needs to make an accurate forecast of the demand for SoftShag carpet (its biggest seller).If the manager does not order enough carpet from the carpet mill,customers will buy their carpet from one of Carpet City’s many competitors. The manager has collected the following demand data for the past 8 months:
Month Demand for Soft Shag Carpet (1,000 yd.)
1 8
2 12
3 7
4 9
5 15
6 11
7 10
8 12
a. Compute a 3-month moving average forecast for months 4 through 9.
b. Compute a weighted 3-month moving average forecast for months 4 through 9. Assign weights of 0.55,0.33,and 0.12 to the months in sequence, starting with the most recent month.
c. Compare the two forecasts by using MAD. Which forecast appears to be more accurate?
6. The manager of the Petroco Service Station wants to forecast the demand for unleaded gasoline nextmonth so that the proper number ofgallons can be ordered from the distributor.The owner has accumulated the following data on demand for unleaded gasoline from sales during the past 10 months:
Month Gasoline Demanded (gal.)
October 800
November 725
December 630
January 500
February 645
March 690
April 730
May 810
June 1,200
July 980
a. Compute an exponentially...

...Brittney King
Week4Homework
Chapter 7
1. Explain the nursing clinical role, as indicated in Exhibits 7.1, 7.2, and 7.3. A competing perspective is much more limited. In extreme form, it might be limited to completion of tasks indicated by patient management protocols and physicians’ orders. All other functions would be assigned to other units of the organization or left undone. Discuss why this broad view is preferable, in terms non-nursing stakeholders, such as trustees, physicians, or patients, might appreciate.
Nursing organizations must provide five functions including delivering excellent care, coordinating and monitoring interdisciplinary care, educating patients, families, and communities, maintaining the nursing organization, and improving nursing performance. Nurses provide a safe, effective, patient centered, timely, efficient, and equitable contribution in delivering excellent care. They’re able to deliver this quality of care by implementing the nursing process; a system of assessing patients, diagnosing individual nursing care needs, planning care, implementing plans, and evaluating care. A broad view is preferable to design, implement, and evaluate patient care by coordinating, delegation, and supervising the care provided by the healthcare team.
2. Describe how the long-term need for nurses is determined and the shift-by-shift variation in need accommodated? (See also Chapter 8, Additional QFD 2.6.)
Staffing...

...systems developme nt is super complex, DFDs and flowcharts ar! e tools that are used to fix order from sanatorium and complexity.Â (Ch 3, p. 50)| | | Â | Points Received:| 4 of 5| Â | Comments:| First, data flow diagrams and flowcharts are the two most frequently used development and documentation tools used today. Second, since systems development is extremely complex, DFDs and flowcharts are tools that are used to create order from chaos and complexity.| |
TCO 1) Name two reasons why it is important to have a working knowledge of DFDs and flowcharting. (Points TCO 1) Name two reasons why it is important to have a working knowledge of DFDs and flowcharting. (Points
The flow diagram and the flowcharts are the two more common systems use. Also when it comes to the system development they can get very complex meaning that the DFD and the flowchart are tools that can be used to create order form chaos and complexity.
TCO 1) What is the purpose behind the five primary activities in the value chain?
First, info flow diagrams and flowcharts argon the two most much utilize development and musical accompaniment tools employ today. Second, since systems developme nt is super complex, DFDs and flowcharts ar! e tools that are used to fix order from sanatorium and complexity.Â (Ch 3, p. 50)| | | Â | Points Received:| 4 of 5| Â | Comments:| First, data flow diagrams and flowcharts are the two most frequently used development and documentation tools...

...Jennifer Wilson
FI 415
Instructor James Stroud
Week4homework
Chapter 4 problems 3,5,8
3. Are the following statements true or false? Please explain why.
a. The only way a company can grow at a rate above its current sustainable growth rate is by issuing new stock?
False. A company could grow its sustainable growth rate by increasing any of the four rates above their sustainable rate which include its profit margin (increase sales, quicker asset turnover, decrease in debts, increase in financial leverage) or in their retention ratio. The problem is that there are limits to a company’s ability to increase these ratios.
b. The stock market is a ready source of new capital when a company is incurring heavy losses?
False. Expecially in our current market people tend to invest cautiously, unless they have a lot of ready capital to invest ,which is unlikely, to buy stocks, and the company would have to ensure they are not using this as their only means of ready capital and that asset turnover remains steady while ensuring a minimal amount of loss – while waiting for this new source to pay off.
c. Share repurchases usually increase earnings per share.
True. repurchasing stock reduces the number of shares outstanding and that contributes to the increased earnings per share. The cost of repurchasing those outstanding shares is a cost the company has to absorb and will reflect on the balance sheet and income...

...HW#4 Assigned on Friday, November 16, 2012 / Due on Thursday, November 29, 2012
Please turn in a hard-copy of your homework to the class. Show all your work to receive full credit for each question.
1. Suppose a stock had an initial price of $91 per share, paid a dividend of $2.40 per share during the year, and had an ending share price of $102.
Compute the percentage total return.
What was the dividend yield? The capital gains yield?
2. Suppose you bought a 7 percent coupon bond one year ago for $1,040. The bond sells for $1,070 today.
a. Assuming a $1,000 face value, what was your total dollar return on this investment over the past year?
b. What was your total nominal rate of return on this investment over the past year?
c. If the inflation rate last year was 4 percent, what was your total real rate of return on this investment? (Hint: use the Fisher equation)
3. Using the following returns, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y.
4. You bought one of Great White Shark Repellant Co.'s 8 percent coupon bonds one year ago for $1,030. These bonds make annual payments and mature six years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is 7 percent. If the inflation rate was 4.2 percent over the past year, what was your total real return on investment? (Hint: calculate the current...

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MAT540 Week 3 Homework
Chapter 14
1. The Hoylake Rescue Squad receives an emergency call every 1, 2, 3, 4, 5, or 6 hours, according to the following probability distribution. The squad is on duty 24 hours per day, 7 days per week:
Time Between
Emergency Calls (hr.)
Probability
1
0.05
2
0.10
3
0.30
4
0.30
5
0.20
6
0.05
1.00
a. Simulate the emergency calls for 3 days (note that this will require a “running”, or cumulative, hourly clock), using the random number table.
b. Compute the average time between calls and compare this value with the expected value of the time between calls from the probability distribution. Why are the results different?
2. The time between arrivals of cars at the Petroco Service Station is defined by the following probability distribution:
Time Between
Arrivals (min.)
Probability
1
0.15
2
0.30
3
0.40
4
0.15
1.00
a. Simulate the arrival of cars at the service station for 20 arrivals and compute the average time between arrivals.
b. Simulate the arrival of cars at the service station for 1 hour, using a different stream of random numbers from those used in (a) and compute the average time between arrivals.
c. Compare the results obtained in (a) and (b).
3. The Dynaco Manufacturing Company produces a product in a process consisting of operations of five machines. The...

...Week4Homework
Solutions: Problem Set 4
1. Determining Profit or Loss from an Investment. Three years ago, you purchased 150 shares of IBM stock for $88 a share. Today, you sold your IBM stock for $103 a share. For this problem, ignore commissions that would be charged to buy and sell your IBM shares.
a. What is the amount of profit you earned on each share of IBM stock? The profit on each share of IBM stock was $15. $103 priced when each share was sold, $88 priced when each share was purchased = $15.
b. What is the total amount of profit for your IBM investment? The total profit for the IBM transaction was $2,250. $15 profit per share x 150 shares = $2,250.
2. Calculating Rate of Return. Assume that at the beginning of the year, you purchase an investment for
$8,000 that pays $100 annual income. Also assume the investment’s value has decreased to $7,400 by the end of the year.
a. What is the rate of return for this investment?
Step 1 subtract the investment’s initial value from the investment’s value at the end of the year.
$7,400 – $8,000 = $600 (negative)
Step 2 add the annual income and the amounts from Step 1.
$600 (negative) + $100 = $500 (negative)
Step 3: divide the total dollar amount of return (Step 2) by the original investment
$500 (negative) ÷ $8,000 = .0625 (negative) = 6.25% (negative)
b. Is the rate of return...

...5200
Homework Assignment for Week4:
For Week4, please complete the following for Joe’s Fly-By-Night Oil Company, whose financial statements are shown below:
• Prepare a ratio analysis for the fiscal year ended Dec 31, 2012. Organize your analysis per the following outline:
(1) Liquidity
- Current ratio: 25,000/17,000=1.47%
Quick ratio: 25,000-17,000/17,000=25,000
Comments on liquidity- The results cant really determine how well or bad the company is doing until you compare it to another company. This ratio helps show the ability to pay off short term obligations as they are due.
(2) Asset management
- Total Asset turnover: 10,000/40,000=.25
Average collection period (ACP): 10,000/365=27
3,000/27=111 days
Comments on asset management- Each $1 of asset is producing .25 in sales. Using assest utilization shows why one firm turns over assests more rapied than another. Average collection period states that it’s taking the customer around 111days to pay off their bills. This indicates how long sales stay on companys books.
(3) Debt management
- Debt ratio: 20,000/40,000=50%
Times interest earned: 3,000/200=15 times
Comments on debt management- Times interest earned shows the number of times that income before interest and taxes covers the interest obligation . The higher the...