Questions from General Finance

Q: Assume you have the following portfolio. /

Assume you have the following portfolio. What is the portfolio’s beta?

Q: Your folks just called and would like some advice from you.

Your folks just called and would like some advice from you. An insurance agent just called them and offered them the opportunity to purchase an annuity for $21,074.25 that will pay them $3,000 per yea...

Q: Assume you have a bond with a semiannual interest payment of $

Assume you have a bond with a semiannual interest payment of $35, a par value of $1,000, and a current market of $780. What is the current yield of the bond?

Q: What is the value of a preferred stock when the dividend rate

What is the value of a preferred stock when the dividend rate is 16 percent on a $100 par value? The appropriate discount rate for a stock of this risk level is 12 percent.

Q: Bates, Inc. pays a dividend of $1 and is

Bates, Inc. pays a dividend of $1 and is currently selling for $32.50. If investors require a 12 percent return on their investment from buying Bates stock, what growth rate would Bates, Inc. have to...

Q: You intend to purchase Dorchester common stock at $50 per share

You intend to purchase Dorchester common stock at $50 per share, hold it for 1 year, and then sell it after a dividend of $6 is paid. How much will the stock price have to appreciate for you to satisf...

Q: Herrera Motor, Inc. paid a $3.50 dividend

Herrera Motor, Inc. paid a $3.50 dividend last year. At a constant growth rate of 5 percent, what is the value of the common stock if the investors require a 20 percent rate of return?

Q: Given that a firm’s return on equity is 18 percent and management

Given that a firm’s return on equity is 18 percent and management plans to retain 40 percent of earnings for investment purposes, what will be the firm’s growth rate?

Q: Distinguish between debentures and mortgage bonds.

Distinguish between debentures and mortgage bonds.

Q: Sanford’s common stock is expected to pay $1.85 in

Sanford’s common stock is expected to pay $1.85 in dividends next year, and the market price is projected to be $42.50 per share by yearend. If investors require a rate of return of 11 percent, what i...