William Woods University Finance Problem Questions Excel Worksheet

William Woods University

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I’m studying for my Business class and don’t understand how to answer this. Can you help me study?

Need help with questions. This is an MBA course so make sure you are being original and you are plag. Show all work and citationations.

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3. Obtain a current quote of McDonald’s (MCD) from the Internet. Describe what has changed since the quote in Figure 8.1. (LG8-2) 4. Get the trading statistics for the three main U.S. stock exchanges. Compare the trading activity to that of Table 8.1. (LG8-2) 9. Describe the difference in the timing of trade execution and the certainty of trade price between market orders and limit orders. (LG8-4) 12. Under what conditions would the constant-growth model not be appropriate? (LG8-5) 2. Characterize the historical return, risk, and risk-return relationship of the stock, bond, and cash markets. (LG9-2) 6. Which company is likely to have lower total risk, General Electric or Coca-Cola? Why? (LG9-3) 7. Can a company change its total risk level over time? How? (LG9-3) 9. You receive an investment newsletter advertisement in the mail. The letter claims that you should invest in a stock that has doubled the return of the S&P 500 Index over the last three months. It also claims that this stock is a surefire safe bet for the future. Explain how these two claims are inconsistent with finance theory. (LG9-4) 11. Describe the diversification potential of two assets with a −0.8 correlation. What’s the potential if the correlation is +0.8? (LG9-5) 8-35 P/E Model and Cash Flow Valuation Suppose that a firm’s recent earnings per share and dividend per share are \$2.50 and \$1.30, respectively. Both are expected to grow at 8 percent. However, the firm’s current P/E ratio of 22 seems high for this growth rate. The P/E ratio is expected to fall to 18 within five years. Compute a value for this stock by first estimating the dividends over the next five years and the stock price in five years. Then discount these cash flows using a 10 percent required rate. 9-34 Risk, Return, and Their Relationship Consider the following annual returns of Molson Coors and International Paper: Molson Coors International Paper Year 1 -16.3% 4.5% Year 2 −9.7 −17.5 Year 3 36.5 −0.2 Year 4 −6.9 26.6 Year 5 16.2 −11.1 Compute each stock’s average return, standard deviation, and coefficient of variation. Which stock appears better? Why? (LG9-3, LG9-4) ...
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3. Obtain a current quote of McDonald’s (MCD) from the Internet. Describe what has changed since the quote in Figure 8.1. (

Get the trading statistics for the three main U.S. stock exchanges. Compare the trading activity to that of Table 8.1. (LG8-2)

9. Describe the difference in the timing of trade execution and the certainty of trade price between
market orders and limit orders. (LG8-4)
Market orders can be executed immediately if a customer requests a purchase or a sale of stock. The
customer is willing to buy or sell at the existing market price. On the other hand, Limited orders
cannot be executed immediately but the customer sets price boundaries at which they are able to buy
or sell the stock.
12. Under what conditions would the constant-growth model not be appropriate? (LG8-5)
The model does not work when stock does not pay dividends and when there are not buybacks of
stock
2. C...

Cornell University
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