What discount rate should be assigned to a project

Assignment Help Financial Management

Reference no: EM131514938

1. Omega Inc. is an unlevered firm that is equally as risky as the market. U.S. Treasury bills are yielding 3.2 percent and the market risk premium is 7.5 percent. What discount rate should be assigned to a project that has the same risks as Omega? A. 3.2 percent B. 10.7 percent C. 7.5 percent D. 4.3 percent

2. A stock returned 13 percent, 18 percent, -16 percent and -1 percent annually for the past four years. The standard deviation of these returns is given as 15.29 percent. Assuming that the stock's returns are normally distributed, what is the 95.44 percent probability range for any one given year? A. -11.8% to 18.8% B. -42.4% to 49.4% C. -47.1% to 52.3% D. -27.1% to 34.1%

Reference no: EM131514938

Questions Cloud

Define singers concept of marginal utility : Explain Singer's goal in this article, and then present his argument in relation to this issue.Define Singer's concept of marginal utility.

Find the water flow rate in gallons per minute : A fluid with viscosity of 100 CP and density 77.5 lbm/ft3 is flowing through a 100 ft length of vertical pipe (Schedule 40 steel).

Bonds outstanding-what is the bonds yield to call : Delta Motors has bonds outstanding which will mature in 12 years. What is the bonds’ yield to call?

What injection rate in gallons per minute would you expect : A hypodermic syringe is used to inject acetone at 700F into a laboratory equilibrium still operating at 5.0 psig. The syringe has a 1.5-in. barrel ID.

What discount rate should be assigned to a project : What discount rate should be assigned to a project that has the same risks as Omega?

Write an essay on psychological disorder : Diagnosis with at least 2 scholarly references. Scholarly references are peer reviewed references. You must use the DSM-V.

What would be the stack draft : An industrial furnace uses natural gas (assume 100% CH4) as a fuel. The natural gas is burned with 20% excess air, and is converted completely to CO2 and water.

What is the flow rate in the one and half inch pipe : A liquid with p = 54 lbm/ft3 and p = 1.5 CP flows from a tank maintained at constant level through 70 ft of 1-1/2-inch Schedule 40 steel pipe.

What is the bonds yield to call : Delta Motors has bonds outstanding which will mature in 12 years. The bonds are callable in 8 years and have call price of $1,050. What is bonds’ yield to call?

User Account

All Pages