Gary kiraly wants to buy a new italian sports car in three

Reference no: EM13396415

1.If you invest $10,000 at 10% interest, how much will you have in 10 years?

A. $13,860
B. $25,940
C. $3,860
D. $80,712

2.How much must you invest at 8% interest in order to see your investment grow to $8,000 in 10 years?

A. $3,070
B. $3,704
C. $3,105
D. none of these

3.You are to receive $12,000 at the end of 5 years. The available yield on investments is 6%. Which table would you use to determine the value of that sum today?

A. Present value of an annuity of $1
B. Future value of an annuity
C. Present value of $1
D. Future value of $1

4.To save for her newborn son's college education, Lea Wilson will invest $1,000 at the beginning of each year for the next 18 years. The interest rate is 12 percent. What is the future value?

A. $7,690.
B. $34,931.
C. $63,440.
D. $62,440.

5.Gary Kiraly wants to buy a new Italian sports car in three years. The vehicle is expected to cost $80,000 at that time. If Gary should be so lucky as to find an investment yielding 12% over that three-year period, how much would he have to invest now in order to accumulate $80,000 at the end of the three years?

6.Kathy has $50,000 to invest today and would like to determine whether it is realistic for her to achieve her goal of buying a home for $150,000 in 10 years with this investment. What return must she achieve in order to buy her home in 10 years?

A. About 12%
B. About 13%
C. About 9%
D. About 10%

7.Financial capital does not include

A. stock.
B. bonds.
C. preferred stock.
D. working capital.

8.Debreu Beverages has an optimal capital structure that is 70% common equity, 20% debt, and 10% preferred stock. Debreu's pretax cost of equity is 9%. Its pretax cost of preferred equity is 7%, and its pretax cost of debt is also 5%. If the corporate tax rate is 35%, what is the weighted average cost of capital?

A. Between 7% and 8%
B. Between 8% and 9%
C. Between 9% and 10%
D. Between 10% and 12%

9.A firm has $50 million in assets and its optimal capital structure is 60% equity. If the firm has $12 million in retained earnings, at what asset level will the firm need to issue additional stock?

A. The firm should have already issued additional stock.
B. The firm can increase assets to $30 million.
C. The firm can increase assets to $20 million.
D. There is insufficient information to determine an answer.

10.A firm's cost of financing, in an overall sense, is equal to its

A. weighted average cost of capital.
B. required yield that investors seek for various kinds of securities.
C. required rate of return that investors seek for various kinds of securities.
D. all of these.

Reference no: EM13396415

Questions Cloud

What are the indole test methyl red test voges-proskauer : what are the indole test methyl red test voges-proskauer test and citrate test imvic reactions? describe in detail all

Which frequently needs lowering its investments in : employees who are represented by a uion are paid approximately 30 more in terms of pay and benefits costs than

Recognize a category of informatics or technology solution : compose a 350- to 500-word summary of the benefits of selecting a product from this category of technology or

An explanation of the importance of marketing to your : create a new product or service for an existing organization. this product or service will be the basisfor your

Gary kiraly wants to buy a new italian sports car in three : 1.if you invest 10000 at 10 interest how much will you have in 10 years? a. 13860b. 25940c. 3860d. 807122.how much must

Wat does this imply about countrys rate of saving vs : we have established a relationship between net capital outflow nco and the trade balance net exports. during this

What circumstances would merely destroy the biome and its : since biome location is determined by temperature and precipitation patterns climatic changes pose a threat to the

Describe the organizational buyers and consumers of your : write a 1400- to 1750-word paper in which you address the followinga. identify the segmentation criteria that will

Create the scatterplot showing change in relative prices on : purchasing power parity requires that the nominal exchange rate equal the ratio of the price level in your country to

User Account

All Pages