CSM Machine Shop is considering a four-year project to improve its production efficiency. Buying a new machine press for $498,000 is estimated to result in $197,000 in annual pretax cost savings. Should the company buy and install the machine press?
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You own a stock portfolio invested 30 percent in Stock Q, 25 percent in Stock R, 30 percent in Stock S, and 15 percent in Stock T. The betas for these four stocks are .91, 1.24, 1.08, and 1.26, respectively. What is the portfolio beta? (Do not round ..
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Great Wall Pizzeria issued 6-year bonds one year ago at a coupon rate of 6.3 percent. If the YTM on these bonds is 8.4 percent, what is the current bond price?
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A bond has a par value of $1,000, a time to maturity of 10 years, and a coupon rate of 8.70% with interest paid annually. If the current market price is $870, what will be the approximate capital gain of this bond over the next year if its yield to m..
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Loan of 12500 is made at an effective interest rate of 8.5%. Payments are made at the end of each interest period. Each payment equals twice the interest due until the borrower pays off the outstanding debt with a final payment of at most, 1800. Find..
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The US Treasury decides to issue a three-year treasury note to raise $16 billion. If the following bids were received, calculate the offer price (to 4 decimal places) of the US T-note per $100 face value.
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Marshall's & Co. purchased a corner lot in Eglon City five years ago at a cost of $690,000. The lot was recently appraised at $747,000. At the time of the purchase, the company spent $35,000 to grade the lot and another $4,700 to build a small buildi..
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The issue makes semiannual payments and has an embedded cost of 7% annually. - What is the company's pretax cost of debt? If the tax rate is 35%, what is the after- tax cost of debt????
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CATO, Inc. just purchased some fixed assets at a total cost of $62,118 that are classified as 3-year property for MACRS. The MACRS table values are .3333, .4445, .1481, and .0741 for Years 1 to 4, respectively. What is the amount of the depreciation ..
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You want to make an investment that will yield a lump sum of $43,665 in 4 years. You will invest at a nominal rate of 8%. How much do you need to invest today to reach the above future value?
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Maggie's Muffins, Inc., generated $2,000,000 in sales during 2013, and its year-end total assets were $1,700,000. Also, at year-end 2013, current liabilities were $1,000,000, consisting of $300,000 of notes payable, $500,000 of accounts payable, and ..
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Doctor Bob purchased 100 acres of land 10 years ago for $10,000 per acre. If he could have alternately invested the money at 8 percent per year, what price per acre must he receive today to break even with his opportunity (required) rate. If Doctor B..
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