Reference no: EM131446741
1. What is the spot rate for the British pound (GBP) on Wednesday in terms of the U.S. dollar (USD)? Or, from the U.S. perspective, what is the direct quote on pounds?)
1GBP = 1.266 USD Wednesday Feb 1, 2017
2. What is the spot price for the USD on Wednesday in terms of the Swiss franc (CHF)? (Or, from the U.S. perspective, what is the indirect rate on Swiss francs?)
1CHF= 1.0069 USD Wednesday Feb 1, 2017
3. Using your answers from #1 and #2 above, calculate the cross rate of exchange between the British pound (GBP) and the Swiss franc (CHF) (need to see your math).
Required exchange rate= (GBP/USD) / (CHF/USD)
= 1.266 / 1.0069
= 1.2573
Therefore, 1 GBP = 1.2573 CHF
4. Calculate the annualized forward premium or discount on six-month forward yen (need to see your math).
|
The cost of equity be if the debt-equity ratio were zero
: Twice Shy Industries has a debt−equity ratio of 1.3. Its WACC is 8.6 percent, and its cost of debt is 7.4 percent. The corporate tax rate is 35 percent. What is the company’s cost of equity capital? What would the cost of equity be if the debt−equity..
|
|
What is limit of net present worth as n approaches infinity
: A manufacturing company is considering investing in a new cutting machine that will cost $120,000 and has an annual maintenance cost of $12,000. There is no salvage value for the machine. What is the limit of the net present worth as N approaches inf..
|
|
Using the covered interest arbitrage theory
: Suppose the spot pound and the 90-day forward pound are both selling for $1.65, while the U.S. interest rates are 10 percent and British interest rates are 6 percent. Using the covered interest arbitrage theory, describe what will happen to the spot ..
|
|
Risk free rate-market risk premium and beta
: We talked at lenght about the CAPM formula and how we can use it to compute the Required Rated investors would need to invest in a company's stock (or equity). The Formula is Rs=Risk Free Rate+Market Risk Premium *Beta. How do we derive the 3 input v..
|
|
What is the spot rate for the british pound
: What is the spot rate for the British pound (GBP) on Wednesday in terms of the U.S. dollar (USD)? Or, from the U.S. perspective, what is the direct quote on pounds?) Calculate the annualized forward premium or discount on six-month forward yen (need ..
|
|
Calculate the eac for both conveyor belt systems
: Lang Industrial Systems Company (LISC) is trying to decide between two different conveyor belt systems. System A costs $264,000, has a four-year life, and requires $81,000 in pretax annual operating costs. Calculate the EAC for both conveyor belt sys..
|
|
What is the companys cost of equity
: Braxton Corp. has no debt but can borrow at 6.2 percent. The firm’s WACC is currently 8 percent, and the tax rate is 35 percent. What is the company’s cost of equity? If the firm converts to 50 percent debt, what will its cost of equity be?
|
|
We covered a lot of material over the past several weeks
: We covered a lot of material over the past several weeks. For your discussion forum for this week simply let me know your thoughts on what was the most important concept or concepts that you learned from Finance 300.
|
|
Financial analysis project
: The Company that you work for has excess capital that needs to be invested. Because you have knowledge of managerial finance, the top management team of the organization has given you the assignment to conduct a thorough financial analysis on a publi..
|