2023 What cash flows are relevant to the value of stock Why the Fed | Assignments Online
2023 What cash flows are relevant to the value of stock Why the Fed | Assignments Online
Assignments Online 2023 Business & Finance
What cash flows are relevant to the value of stock?
Why the Fed was initially established?
Suppose a firm’s stock has a beta of 1.2. What will probably happen to the value of the stock if the market decreases by 20 percent?
Describe the likely consequences for GDP growth when the FOMC directs the trading desk at the New York Fed to sell Treasury securities.
Explain how STRIPs can be used to immunize portfolios against interest rate risk.
Why must the balance of payments always balance?
Why might consumer groups support government policies that maintain a “strong” U.S. dollar?
What are the four types of secondary markets?
What are the tax advantages of qualified private pension plans?
Why are life insurance and life annuities often described as opposites?
What are the largest asset categories on a life insurance company balance sheet?
If you had a 6 percent, $100,000, 15-year mortgage and you paid it as scheduled, how much interest would you pay in the first month of the sixth year on that mortgage? How much principal would you pay?
MULTIPLE-CHOICE QUESTIONS
Which of the following is not an example of capital market securities?
a. common stocks
b. convertible bonds
c. commercial paper
d. mortgages
In a board of director’s election for five directors and straight voting, a majority group of shareholders will elect
e. four directors.
f. five directors.
g. four or five depending on how the cumulative voters vote.
h. the same proportional share of directors as their ownership share.
Security exchanges provide a valuable function in that they
i. create interest in stocks.
j. increase the marketability of securities.
k. provide a legal way to gamble.
l. supply money to deficit spending units.
m. both a and d
Which of the following is not true about American Depository Receipts (ADRs)?
n. ADRs are claims issued by U.S. financial intermediaries (FIs) against shares in foreign companies, with the shares held in custody by the FIs for investors.
o. ADRs are issued in the U.S. and are denominated in U.S. dollars. All cash flows to the investor are in dollars.
p. An ADR enhances a company’s visibility, status and profile in the U.S. and internationally among investors.
q. An ADR decreases the foreign firm’s U.S. liquidity (and potentially total global issuer liquidity).
The Wall Street Journal publishes T-bill price (bid/ask) based on the ___________ rate; with the __________ rate provided as the quoted (ask) yield on the T-bill.
a. bond equivalent; bank discount
b. effective annual; bank discount
c. bank discount; bond equivalent
d. bank equivalent; bank discount
Federal Small investors are likely to invest in the money market through ____.
a. directly; commercial paper
b. locally; their credit union
c. indirectly; negotiable CDs
d. indirectly; money market mutual funds
What is the bank discount rate on a $100,000 face value T-bill priced at $97,500, maturing in 181 days?
a. 2.50%
b. 4.84%
c. 4.97%
d. 5.10%
e. 5.17%
TRUE-FALSE QUESTIONS
For large corporations, commercial paper is more expensive but is a more assured alternative to bank borrowing.
Individual investors most often have only indirect access to the money market through commercial banks.
Federal Reserve open market operations, reserve requirement changes, and discount rate policy first impact the economy in the money market.
QUANTITATIVE QUESTIONS
Winters Hi-Hook Inc., a golf club manufacturer, is currently paying dividends of $.50 per share. These dividends are expected to grow at a 20 percent rate for the next two years and at a three percent rate thereafter (forever!). What is the value of the stock if the appropriate discount rate is 14 percent?
You purchase 100 shares of Adams Trading Company stock today for $22.50 per share. At the end of one year, you collect a dividend of $2.75 and then sell the stock at $24.50 per share. What is your total return on the stock? What is the dividend yield? What is the capital gains yield?
Farrell Motors stock has a beta of 1.3. If the market risk premium is 8.5 percent and the risk-free rate is 4 percent, what is the expected return of the stock according to the security market line?
Assignmentsonline.org help students to solve their assignment in the best possible manner. In the assignment help industry, we are regarded as one of the best helpers for students’ tasks in all subjects. We provide solutions to students from all corners of the world, but the main focus is from students residing in the US, UK, and Australia. Our primary focus is solving student assignments for all subjects and streams.
Place Order NOw
Assignment online is a team of top-class experts whose only goal is to give you the best assignment help service. Follow the link below to order now...
#write essay #research paper
