Calculate the future value of an annuity that has the

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  1. Calculate the Future Value of an Annuity that has the following characteristics: (a) PMT: $1,505, (b) RATE: 10%, and (c) NPER: 25.
  2. Determine how much you would be willing to pay for an Annuity Due that has the following characteristics: (a) PMT: $5,500, (b) RATE: 8%, and (c) NPER: 15.
  3. How much would you be willing to pay for a bond that pays Semi-Annual coupon payments and has the following characteristics: (a) NPER: 18, (b) YTM: 8%, and Coupon: $72.50.
  4. What is the maximum price that you would be willing to pay for a no-growth stock that has the following characteristics: (a) Dividend (Has Paid): $4.00 and (b) Required Rate of Return: 12%.
  5. What is the maximum price that you would be willing to pay for a constant growth stock that has the following characteristics: (a) Dividend (Has Paid): $3.25, (b) Growth: 7%, and (c) Required Rate of Return: 12%.
  6. What is the maximum price that you would be willing to pay for a non-constant growth stock that has the following characteristics: (a) Non-Constant Growth Rate: 20%, (b) Constant Growth Rate: 5%, (c) Dividend (Will Pay): $4.50, and (d) Required Rate of Return: 12%.
  7. What is the current yield on a bond that has the following characteristics: (a) Price: $1,055, (b) Coupon Rate: 5%, (c) YTM: 4.6%, and (d) NPER: 22.
  8. What is the Expected Rate of Return on Stock XYZ given the following information (Use CAPM): (a) Expected Return on the Risk Free Asset: 3%, (b) Expected Rate of Return on the Market: 9.5%, and (c) Beta for XYZ Stock: 1.32.
  9. What is the Beta for XYZ Company, given the following information: (a) Expected Return on Company XYZ's Stock: 9%, (b) Expected Return on the Risk Free Asset: 3%, and (c) Expected Rate of Return on the Market: 9.5%.
  10. Calculate the YTM on a bond with the following characteristics: (a) Price: $884, (b) Coupon: $50.00, and (c) NPER: 24.
  11. Calculate Company A's weighted average cost of debt, given the following information: (a) Tax Rate: 20%, (b) Average Price of Outstanding Bonds: $1,120, (c) Coupon Rate: 5%, (d) NPER: 27, (e) Debt: $33,000,000, (f) Equity: $24,000,000, and (g) Preferred Stock: $5,000,000.
  12. Calculate Company B's weighted average cost of equity, given the following information: (a) Dividend: $1.50, (b) Growth Rate: 4.5% (c) Price: $21.50, (d) Debt: $33,000,000, (e) Equity: $24,000,000, and (f) Preferred Stock: $5,000,000.
  13. Calculate Company C's weighted average cost of preferred stock, given the following information: (a) Coupon Payments: $6.00, (b) Price of Preferred Stock: $50.00, (c) Debt: $33,000,000, (d) Equity: $24,000,000, and (e) Preferred Stock: $5,000,000.
  14. Calculate Company D's weighted average cost of capital, given the following information: (a) Tax Rate: 22%, (b) Average Price of Outstanding Bonds: $1,280, (c) Coupon Rate (Debt): 7%, (d) NPER (Debt): 10, (e) Dividend: $4.60, (f) Growth Rate: 6%, (g) Price: $40.50, (h) Coupon Payments on Preferred Stock: $4.00, (i) Price of Preferred Stock: $45.60.00, (j) Debt: $10,000,000, (k) Equity: $15,000,000, and (l) Preferred Stock: $2,000,000.
  15. Calculate Company E's weighted average cost of equity, given the following information: (a) Expected Return on the Market: 14%, (b) Beta for Company E: 1.34, (c) Expected Risk Free Rate of Return: 4%, (d) Debt: $33,000,000, (e) Equity: $24,000,000, and (f) Preferred Stock: $5,000,000.

Note: For Problems 16 through 23 use the data provided in Table 1

Table 1: Cash Flow Summary

Year

Project A

Project B

0

-30000

-30000

1

15000

12500

2

15000

10000

3

10000

15000

4

10000

15000

  1. If Company XYZ has a WACC of 7% and the two projects are independent, which project would you accept based upon NPV rules?
  2. If Company XYZ has a WACC of 26% and the two projects are mutually exclusive which project would you accept based upon NPV rules?
  3. What is the Internal Rate of Return for Project A?
  4. What is the Profitability Index for Project B?
  5. What is the Discounted Profitability Index for Project A (WACC: 8%)?
  6. What is the Payback Period for Project B?
  7. What is the Discounted Payback Period for Project A (WACC: 8%)?
  8. What is the Crossover Rate for Project's A and B?
  9. Calculate the difference between daily and annual compounding, given the following information: (a) PV: $50,000, (b) NPER: 30, and (c) RATE: 10%.
  10. Calculate the PMT on a mortgage, given the following information: (a) PV: $430,000, (b) RATE: 4%, and NPER: 30.
  11. Calculate the present value of a lump sum payment with the following characteristics: (a) RATE: 5%, (b) NPER: 22, and (c) FV: $55,230.
  12. Calculate the RATE given the following characteristics: (a) PV: $24,325, (b) FV: $54,000, and (c) NPER: 15.
  13. Calculate the NPER given the following characteristics: (a) PV: $50,000, (b) FV: $134,000, and (c) RATE: 5%.
  14. Calculate the RATE given the following characteristics: (a) PMT: $20,000 (you are paying), (b) FV: $134,000, and (c) NPER: 5.
  15. Calculate the required rate of return on a company's stock that has the following characteristics: (a) Constant Growth Rate: 5%, (b) Price: $50.00, and (c) Dividend (Has Been Paid): $5.00.

Reference no: EM13381771

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