False. Question 2 (5) The return of equity is equal to the return on debt of a project/firm Always true. Never true. Sometimes true. Question 3 (10 points) Moogle‚ Inc. is in the same business as Google‚ Inc.‚ but has recently retired all its debt to become an all-equity firm. Its return on equity has dropped from 12.25% to 10.60% as a result of this. Google‚ Inc. continues to have debt in its capital structure‚ and its debt-to-equity ratio is 30%. What is the return on assets of Google‚ Inc
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539.92. How much did your grandmother originally invest? a. $2‚700.00 b. $2‚730.30 c. $2‚750.00 d. $2‚768.40 e. $2‚774.90 d 2. Forty years ago‚ your father invested $2‚500. Today that investment is worth $107‚921. What is the average rate of return your father earned on his investment? a. 8.50 percent b. 9.33 percent c. 9.50 percent d. 9.87 percent e. 9.99 percent a 3. An annuity stream of cash flow payments is a set of: a. level cash flows occurring each time period for a fixed length
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Compounding Factor (6%‚8) = 3‚000‚000 C * 9.90= 3‚000‚000 C = $303‚107.83 2. You have just taken out a mortgage for $575‚000‚ at a fixed rate of 4.75% per year‚ compounded monthly‚ and a term of 30 years. a) Calculate the monthly payments The payments must discount to a value that is equivalent to $575‚000 today‚ assuming a monthly rate of (4.75%/12)‚ or 0.39583% per month‚ for 360 months. C * Annuity discount factor (0.39583%‚360) = 575‚000 C * 191.70 = 575‚000 C = $2
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Which one of the following statements is correct concerning annual percentages rates (APRs)? Answer: The APR is equal to the monthly interest rate multiplied by 12 Give an interest rate of zero percent‚ the future value of a lump sum invested today will always: Answer: remain constant Answer: II and IV A firm created as a separate and distinct legal entity that may be owned by one or more individuals or entities is called a: corporation The capital structure of a firm refers to the
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CANADIAN SHIPPING RATES : CANADA POST LETTERMAIL : This service starts at $2.99 per item. Larger items may not have this option available. This service usually takes 1-14 business days to arrive based on your location. We ship out of Toronto‚ Ontario. This option does not offer tracking. The parcel is insured in case of loss for maximum of $20.00. CANADA POST EXPEDITED : This service varies on province and size of item. Larger items may not have this option available. This service usually takes
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of directors. The purchase was revealed yesterday in a filing with the Securities and Exchange Commission‚ and separately in a letter to Teletech’s CEO‚ Maxwell Harper. “The firm is misusing its resources and not earning an adequate return‚” the letter said‚ “The company should abandon its misguided entry into comput-ers‚ and sell the Product and Systems Segment. Management must focus on creating value for shareholders.” Teletech issued a brief statement
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Ch.5 Yield (total return) = Dollar inc + (end-beg) beg. Value Risk of Return = r= Risk Free rate + Risk Prem r=rRF+DRP+LP+MRP Risk Free Rate = rRF = r* + IP -effects of int rates on PV/Price of securities: int goes up‚ value of bonds goes down‚ stock goes down (NPV) Prices -factors that influence int rates/yield curve 1.production opportunities-return avail w/in an economy from inves. In productive asset; higher prod opp‚ higher return 2. Time preferences for consumption 3
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Return on Investment (ROI) and Total Cost of Ownership: A Comparison Introduction When a business decision is made to make an investment‚ the need for metrics arises to decide the profitability of the investment. These metrics can be measured before an investment is made to gain an insight into expected returns or they can be measured at regular intervals‚ (quarterly or yearly) to analyse the profitability of the investment. There are quite a few metrics that are used to calculate profitability
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personal tax returns. In addition to a process map indicating the process that the staff is required to go through and time each process takes‚ discussion on how such process can be reengineered will follow. Finally‚ under the assumption that the concurrent technological support is available‚ an analysis on the cost and benefits of new information technology will be provided. EVALUATION OF PROCESS Although Ernst &Young believes that extra checks in the office to prepare personal tax returns build a
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Total Cost of Ownership: This is defined as the an approach for measuring financial returns which involves consideration of all the additional costs required to support and maintain the item purchased for its full useful life and adding such costs to the purchase price (Reh‚ n.d). Calculating TCO No general formula for calculating TCO exist the general principle is Purchase Costs + All other additional costs. In IT investments some additional costs might be cost of maintenance‚ support costs
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