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Finance Problems Assignment




Question;A $1,000 face value bond currently has a yield to maturity of 6.59 percent. The bond matures in 3 years and pays interest annually. The coupon rate is 7 percent. What is the current price of this bond?A 9-year project is expected to generate annual revenues of $114,500, variable costs of $73,600, and fixed costs of $14,000. The annual depreciation is $3,500 and the tax rate is 34 percent. What is the annual operating cash flow?Healthy Foods just paid its annual dividend of $1.45 a share. The firm recently announced that all future dividends will be increased by 2.5 percent annually. What is one share of this stock worth to you if you require a 14 percent rate of return?Keller Metals common stock is selling for $38 a share with a historical growth rate of 2 percent and has a dividend yield of 3.2 percent. What is the dividend amount?Soft and Cuddly is considering a new toy that will produce the following cash flows. Should the company produce this toy if the firm requires a 15 percent rate of return?Year Cash Flow0 -$ 31,0001 26,0002 9,000The Pancake House pays a constant annual dividend of $1.50 per share. How much are you willing to pay for one share if you require a 15 percent rate of return?What is the net present value of a project with the following cash flows if the discount rate is 13 percent?Year Cash Flow0 -$ 39,4001 12,8002 21,7003 18,100Given the same cash flows as the last question, what is the Internal Rate of Return (IRR)?0 -39,4001 12,8002 21,7003 18,100You are analyzing a project and have developed the following estimates. The depreciation is $19,800 a year and the tax rate is 34 percent. What is the best case operating cash flow?Base Case Lower Bound Upper BoundUnit Sales 4,400 3,800 4,900Sales Price $62 $59 $65Variable Costs per Unit $47 $44 $50Fixed Costs $23,000 $21,500 $24,500


Paper#48485 | Written in 18-Jul-2015

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