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In which of the following is ATP made?

Risk averse investors prefer a project with higher risk when the expected returns of the two projects are the same.

Which of the following has a positive cash flow effect?

The Hope Corporation has been presented with an investment opportunity which will yield end of year cash flows of: $80,000 per year in Year 1 $50,000 per year in Year 2 $60,000 in Year 3 This investment will cost the firm $100,000 today, and the firm’s required rate of return is 12 percent. What is the NPV for this investment? (Select the closest answer.)

The expected P/E multiple of ABC is 40 and the expected P/E multiple of XYZ is 8. Why are P/E multiples of the two stocks so different? 

Which of the following is a short-term debt instrument? 

Sarasota Inc. is considering a project that has the following cash flows: Year Cash Flow 0 -$1,200 1 400 2 300 3 700 4 500 The company’s cost of capital (discount rate) is 10%.  Does the company accept the project?

The current market price of ABC Corporation’s 12 percent coupon, 20-year maturity bonds is $1,200.00. Coupon is paid semiannually, and the par value is equal to $1,000. What is the YTM of the bond today?

The Lumber Company had the following balance sheet and income statement information. Balance  Sheet on December 2019: Cash $   120 A/R 900 Inventories 4,000 Total CA $5,020 Debt $3,000 Net Fixed Asset 2,980 Equity 5,000 Total Assets $8,000 Total Liability & Equity $8,000 Income Statement during 2019: Sales $10,800 Cost of goods sold 10,000 EBIT $        800 Interest (12%) 360 EBT $       440 Taxes (%40) 176 Net Income $        264 The industry days sales outstanding (DSO) is 16.  If management can improve the credit department and collection procedure sufficiently to reduce DSO to the industry average (16), how much cash could be freed up?  Assume that the sales level will remain constant. [DSO=AR/ (Annual Sales/360)]

You just purchased a new car and had to borrow $25,000.  According to the financing arrangement, you must repay the loan via 5 years of monthly payments at a nominal rate of 5.5%.  How much are each of those monthly loan payments?