# FINANCE

Anonymous

Question description

I want someone to tutor me to show what formula I should use
to get the answers.  I don't only need

Assume you are given the following

relationships for the Clayton Corporation:

Sales/total assets

1.8

Return on assets (ROA)

4%

Return on equity (ROE)

8%

1.Calculate Clayton's profit margin.

%

2.Calculate Clayton's debt ratio. Round

%

#2

Stock R has a beta of 1.8, Stock S has

a beta of 0.65, the expected rate of return on an average
stock is

13%, and the risk-free rate is 4%. By how much does the
required

return on the riskier stock exceed the required return on
the riskier

stock exceed that on the less risky stock?

#3

Wilson Wonders's bonds have 7 years

remaining to maturity. Interest is paid annually, the bonds
have a

\$1,000 par value, and the coupon interest rate is 9%. The
bonds sell

at a price of \$1,095. What is their yield to maturity? Round
your

#4

DPS CALCULATION

Thress Industries just paid a dividend

of \$4.00 a share (i.e., D0 = 4.00). The dividend is expected
to grow

5% a year for the next 3 years and then at 11% a year
thereafter.

What is the expected dividend per share for each of the next
5 years?

a.D1 = \$

B

C

D

#5

PREFERED STOCK RATE OF RETURN

What will be the nominal rate of return

on a perpetual preferred stock with a \$100 par value, a
stated

dividend of 8% of par, and a current market price of (a)
\$57, (b)

\$85, (c) \$95, and (d) \$134? Round the answers to two decimal
places.

#6

Assume that the average firm in your

company's industry is expected to grow at a constant rate of
6% and

risky as the

average firm in the industry, but it has just successfully
completed

some R&D work that leads you to expect that its earnings
and

dividends will grow at a rate of 50% [D1 = D0(1 + g) =
D0(1.50)] this

year and 20% the following year, after which growth should

the 6% industry average. If the last dividend paid (D0) was
\$2.25,

what is the value per share of your firm's stock? Round your

to the nearest cent. Do not round your intermediate
computations.(NON

CONSTANT GROWTH VALUATION)

#7 REPAYING A LOAN

While Mary Corens was a student at the

University of Tennessee, she borrowed \$12,000 in student
loans at an

annual interest rate of 8.10%. If Mary repays \$1,500 per
year, how

long (to the nearest year) will it take her to repay the
loan?

#8 CASH FLOWS

income (EBIT) of \$950,000. The company's depreciation
expense is

\$237,500. Moore is 100% equity financed, and it faces a 40%
tax rate.

1. What is the company's net income?

2. What is its net cash flow?

#9 PRICE EARNING RATION

Needham Pharmaceuticals has a profit

margin of 5.5% and an equity multiplier of 2.5. Its sales
are \$100

million and it has total assets of \$60 million. What is its
ROE?

#10 INCOME STATEMENT

Pearson Brothers recently reported an

EBITDA of \$7.5 million and net income of \$1.5 million. It

million of interest expense, and its corporate tax rate was
40%. What

was its charge for depreciation and amortization?

#11 PRESENT VALUE OF A SINGLE PAYMENT

What is the present value of a security

that will pay \$10,000 in 5 years if securities of equal risk
pay 9.2%

annually?

#12

PUT CALL PARITY

The current price of a stock is \$32,

and the annual risk-free rate is 6%. A call option with a
strike

price of \$29 and 1 year until expiration has a current value
of

\$7.30. What is the value of a put option written on the
stock with

the same exercise price and expiration date as the call
option? Round

#13  DEFAULT RISK

A Treasury bond that matures in 10

years has a yield of 5%. A 10-year corporate bond has a
yield of 10%.

Assume that the liquidity premium on the corporate bond is
0.8%. What

is the default risk premium on the corporate bond?

#14 EXPECTED RATE OF RETURN

Washington-Pacific invests \$5 million

to buy a tract of land and plant some young pine trees. The
trees can

be harvested in 10 years, at which time W-P plans to sell
the forest

at an expected price of \$10 million. What is W-P's expected
rate of

#15  yield to maturity
and current

yield

You just purchased a bond that matures

in 15 years. The bond has a face value of \$1,000 and has an
8% annual

coupon. The bond has a current yield of 8.37%. What is the
bond's

%

#16  number of period
for a maturity

You have \$48,564.75 in a brokerage

account, and you plan to deposit an additional \$2,500 at the
end of

every future year until your account totals \$400,000. You
expect to

earn 9.4% annually on the account. How many years will it
take to

#17 required of return

Assume that the risk-free rate is 3.5%

and that the expected return on the market is 10%. What is
the

required rate of return on a stock that has a beta of 0.8?

%

18

Assume you have been given the

following information on Purcell Industries:

Current stock price = \$16

Strike price of option = \$11

Time to maturity of option = 2 months

Risk-free rate = 6%

Variance of stock return = 0.15

d1 = 0.28449

N(d1) = 0.48652

d2 = 0.0532

N(d2) = 0.64298

According to the Black-Scholes option

to the

nearest cent.

attachement

Attachments:

FINANCE FINAL.docx
(16K)

You cannot edit a question once one or more tutorials have
been posted.

tassycorp Not confirmed

Rating :No Rating

Tutorials Posted: 0

tassycorp

(6)

|  Tutorial Bucket  | Logout

Home

Get Tutoring

Get Paid

My Account

How Does This Work?

|

My Pending Questions

|

Recently Viewed Questions

|

Leave Feedback

Unpurchased Tutorials

|

Recent Tutorials

|

Topics

Studypool has helped 1,244,100 students
flag Report DMCA

Brown University

1271 Tutors

California Institute of Technology

2131 Tutors

Carnegie Mellon University

982 Tutors

Columbia University

1256 Tutors

Dartmouth University

2113 Tutors

Emory University

2279 Tutors

Harvard University

599 Tutors

Massachusetts Institute of Technology

2319 Tutors

New York University

1645 Tutors

Notre Dam University

1911 Tutors

Oklahoma University

2122 Tutors

Pennsylvania State University

932 Tutors

Princeton University

1211 Tutors

Stanford University

983 Tutors

University of California

1282 Tutors

Oxford University

123 Tutors

Yale University

2325 Tutors