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The Woods Co. and the Garcia Co. have both announced IPOs at $76 per share. One of these is undervalued by $8, and the other is overvalued by $3, but you have no way of knowing which is which. You plan on buying 1,300 shares of each issue. If an issue is underpriced, it will be rationed, and only half your order will be filled.
a) If you could get 1,300 shares in Woods and 1,300 shares in Garcia, what would your profit be?
Profit:
b) What profit do you actually expect?
Expected profit:
Preparing monthly forecasts of Fantastic's financial statements and monthly cash budgets for 1981 and 1982
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You're trying to save to buy a new $201,000 Ferrari. You have $51,000 today that can be invested at your bank. The bank pays 5.9 percent annual interest on its accounts. How long will it be before you have enough to buy the car?
The Digby's balance sheet has $119,413,000 in equity. Further, the company is expecting $3,000,000 in net income next year. Assuming no dividends are paid and no stock is issued, what would their Book Value be next year?
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