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FINC 600 Week 1 Homework




FINC 600 Week 1 Homework;Problem 1-6;In most large corporations, ownership and management are separated. What are the main implications of this separation?;Problem 1-8;We can imagine the financial manager doing several things on behalf of the firm?s stockholders. For example, the manager might;a. Make shareholders as wealthy as possible by investing in real assets.;b. Modify the firm?s investment plan to help shareholders achieve a particular time pattern of consumption.;c. Choose high- or low-risk assets to match shareholders? risk preferences.;d. Help balance shareholders? checkbooks.;But in well-functioning capital markets, shareholders will vote for only one of these goals. Which one? Why?;Problem 2-9;A. The cost of an automobile is $10,000. If the interest rate is 5%, how much would you have to set aside now to provide this sum in five years?;B. You have to pay $12,000 a year in school fees at the end of each of the next six years. If the interest rate is 8%, how much do you set aside today to cover these bills?;C. You have invested $60,476 at 8%. After paying the above school fees, how much would you remain at the end of six years?;Problem 2-12;What is the PV of $100 received in;A. Year 10 (at a discount rate of 1%);B. Year 10 (at a discount rate of 13%);C. Year 15 (at a discount rate of 25%);D. Each of years 1 through 3 (at a discount rate of 12%)?;Problem 3-3;In February 2009 Treasury 6s of 2026 offered a semiannually compounded yield of 3.5985%. Recognizing that coupons are paid semiannually, calculate the bond's price.;Problem 3-4;Here are the prices of three bonds with 10-year maturities;Bond Coupon (%);Price (%);2;81.62;4;98.39;8;133.42;If coupons are paid annually, which bond offered the highest yield to maturity?;Which had the lowest?;Which bonds had the longest and shortest durations?;Instruction;NAME;To complete the homework assignments in the templates provided;1.;The question is provided for each problem. You may need to refer to your textbook for additional information in a few cases.;2.;You will enter the required information into the shaded cells.;3.;The cells are coded;a.;T requires a text answer.;b.;C requires a calculation. You cannot perform the operation on a calculator and then type the answer in the cell. You will enter the calculation in the cell, using Excel format/formula/function and only the final answer will show in the cell. I will be able to review your calculation and correct, if necessary.;c.;F requires a number only. In some problems, a ?Step 1? is added to help you solve the problem.;4.;Name your assignment file as " lastnamefirstinitial-FINC600-Week# ", and submit by midnight ET, Day 7.


Paper#78224 | Written in 18-Jul-2015

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