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Consider a bond with a coupon of 5.6 percent, ten years to maturity, and a current price of $1,057.70. Suppose the yield on the bond suddenly increases by 2 percent. Use duration to estimate the new price of the bond. (Do not round intermediate calculations. Round your answer to 2 decimal places. Do not include the $ sign) exam spreadsheet (8).xlsx

A fully hedged stock portfolio will have a beta equal to which one of the following?

Beagle Beauties engages in the development, manufacture, and sale of a line of cosmetics designed to make your dog look glamorous. Below you will find selected information necessary to compute some valuation estimates for the firm. Assume the values provided are from year-end 2019. Also assume that the firm’s equity beta is 1.60, the risk-free rate is 2.25 percent, and the market risk premium is 7 percent.           Dividends per share $ 2.10   Return on equity   9.50 % Book value per share $ 17.50       Earnings Cash Flow Sales 2019 value per share $ 5.00   $ 6.60   $ 25.65   Average price multiple   13.10     9.45     2.39   Forecasted growth rate   13.51 %   11.38 %   7.21 %   What is the sustainable growth rate for Beagle Beauties? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Do not include the % sign) exam spreadsheet (8).xlsx

A stock is currently selling for $38.50 a share and has a dividend yield of 1.75%. The risk-free rate is 3.5%. What is the 2-month futures price on this stock? exam spreadsheet (8).xlsx

Able, Baker, and Charlie are the only three stocks in an index. The stocks sell for $71, $312, and $86, respectively. If Baker undergoes a 3-for-2 stock split, what is the new divisor for the price-weighted index? Note: Do not round intermediate calculations. Round your answer to 5 decimal places. exam spreadsheet (8).xlsx

You own 500,000 bushels of wheat. If you decide to add a short futures position in wheat you will be taking which one of the following positions?

The model used to value a stock that pays a dividend which increases at a constant rate forever is referred to as which one of the following? Assume the growth rate is less than the discount rate.

You went long 30 December 2019 crude oil futures contracts at a price of $48.66. Looking at Figure 14.1, if you closed your position at the settle price on this day, what was your profit? (Do not include the $ sign) exam spreadsheet (8).xlsx

The Clothing Company purchased six futures contracts on cotton at a quoted price of 60.70 as a hedge against its inventory needs. At the time it actually needed the cotton, the spot price was 61.50. Cotton futures are based on 50,000 pounds and quoted in cents per pound. How much did the Shirt Factory save by hedging cotton? exam spreadsheet (8).xlsx

What is the amount of the difference between the highest and the lowest value of a December heating oil contract on this day? Contract Open High Low Close December, Heating oil, 40,000 gallons, $ and cents per gallons 3.5503 3.7444 3.6652 3.7222 December, Crude oil, 1,000 barrels, $ and cents per barrels 120.71 122.50 120.70 122.40 exam spreadsheet (8).xlsx