Blog

You anticipate selling 10,000 units of Wonder Soap in the next month. It cost $3.50 per order and total carrying costs are $1.50 per unit. What is the optimal order quantity for this new product?

An investment dealer spread is:

When a firm raises its dividend, the information content is usually positive for investors.

The cost of forgoing the discount on trade credit of 4/10, net 25 is equal to:

Project A has a $5,000 net present value at a zero discount rate and an internal rate of return of 12%. Project B has an $8,000 net present value at a 0% discount rate and an IRR of return of 10%. If the projects are mutually exclusive, which one should be chosen?

An issue of common stock is expected to pay a dividend of $4.00 at the end of the year. Its growth rate is equal to 8%. If the required rate of return is 15%, what is its current price?

A 4-year bond pays 4% annual interest (paid semi-annually). It currently sells for $872.25. What is the bond’s yield to maturity?

Laura’s Book Shoppe is going to borrow $50,000 for 90 days at an annual rate of 9%. The amount of interest owing in 90 days will be:

The major drawback for viewing dividends as a passive variable is that shareholders likely have some preference related to dividend payments.

A 20-year bond pays 12% on a face value of $1,000. If similar bonds are currently yielding 9%, what is the market value of the bond?