Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Basic Finance Expert

Instructions:

1. CEOs like to hide bad information from the financial market, what's the consequence? What can be done to prevent this?

2. What are the major differences between common stock and preferred stock?

3. Give three main reasons that a private firm wants to issue equity (IPO); give two main reasons that a public firm wants to go private.

4. Why securitization is common in highly developed financial market?

5. Assume that only the following three stocks exist in the financial market, calculate the price-weighted index, value-weighted index, and equal-weighted index. Assume initial index as 100.

Stock Name Initial Price   End Price  Share (Thousands)
A 50 80 5
B 60 40 2
C 20 12 20

Index Initial Value End Value
Price-Weighted 100
Value Weighted 100
Equal-Weighted 100

6. You are buying a put option of GM at a strike price of $75 and maturity of 1 months. The current trading price is $75. The price of the option is $2. What would be the major motive to buy the put option? What is the maximum loss for the investment? What is the maximum gain?

7. What's the benefit of buying on margin? If the initial margin is 50%, maintenance margin is 40%, when will you receive a margin call for the stock you bought at $50/share at margin?

8. Corporate governance is believed to promote long term goal of the firm. As such, investing in firms with good corporate governance has been proved to be profitable. Give two other aspects of "good firm", which you believe are associated with higher value / stock return in the long run.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M91418718
  • Price:- $60

Priced at Now at $60, Verified Solution

Have any Question?


Related Questions in Basic Finance

Starting with her next salary payment next month kathy

Starting with her next salary payment (next month), Kathy intends to save $200 each month. If the interest rate is 1% per month, how much will Kathy have saved after 12 months (12 deposits altogether over 12 months)? Fil ...

1 you have been asked to develop a capitation rate for a

1. You have been asked to develop a capitation rate for a primary care group based on the following projections: Service Annual Frequency/1,000 Cost per Service Inpatient Visits 100 $7,000.00 Office Visits 3,000 $45.00 L ...

An investor has 5000 invested in a stock which has an

An investor has $5,000 invested in a stock which has an estimated beta of 1.2, and another $15,000 invested in the stock of the company for which she works. The risk-free rate is 6 percent and the market risk premium is ...

A new piece of equipment is purchased for 15000 the

A new piece of equipment is purchased for $15,000. The expected lifetime of the asset is five years. Which depreciation method depreciates exactly 3,000 each year? It would be Straight-line, Modified Accelerated Cost Rec ...

Questions -q1 cj co stock has a beta of 09 the current

Questions - Q1: CJ Co stock has a beta of 0.9, the current risk-free rate is 5.6, and the expected return on the market is 13 percent. What is CJ Co's cost of equity? Q2: TAB Inc. has a $100 million (face value), 10-year ...

Please show all work use of formula etcyou have just joined

Please show all work (use of formula, etc) You have just joined the investment banking firm of Danny, Chatman, and Howard. They have offered you two different salary arrangements. You can have $80,000 per year for the ne ...

A firm is considering a project that has the following

A firm is considering a project that has the following estimated cashflows: Increased sales to business of $100,000 for the next six years (starting in one year's time) Increased costs of $30,000 for the next six years ( ...

On january 11998 the total assets of the mccue company were

On January 1,1998, the total assets of the McCue company were $270 million. The first present capital structure, which follows, is considered optimal. Assume that they have no short-term debt. Long-term debt              ...

What are a few benefits from using a gantt chart when

What are a few benefits from using a gantt chart when scheduling projects?

Your parents are giving you 190 a month for 4 years while

Your parents are giving you $190 a month for 4 years while you are in college. At an interest rate of .45 percent per month, what are these payments worth to you when you first start college? $7,912.94 $7,776.51 $10,154. ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As