A project has been assigned a discount rate of 12 percent. If the project starts immediately, it will have an initial cost of $480 and cash inflows of $350 a year for three years. If the start is delayed one year, the initial cost will rise to $520 and the cash flows will increase to $385 a year for three years. What is the value of the option to wait?
A) $.70
B) $1.08
C) $1.67
D) $2.20
E) $.20
A) $.70
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How often does the PCAOB inspect registered accounting firms that audit fewer than 100 issuers?
a. Annually b. Every two years. c. Every three years. d. Every five years.
You are considering the bonds of Epsilon, Inc., a printer manufacturer. The bonds make semiannual payments and have five years to maturity, a coupon rate of 6%, and a redemption value of $1,000.
a) Determine the intrinsic value of these bonds assuming that your required rate of return is 8% (use the PV function). Also determine the current yield and the yield to call (use the RATE function) if the bonds can be called in four years with a call premium of 2%. b) Determine the duration, modified duration, and convexity of these bonds using formulas 10-5, 10-6, and 10-10 provided in the text book. c) Now assume that the settlement date for your purchase would be 01/01/2018. Using the Price, Yield, Duration, MDuration, and Fame_Convexity functions, recalculate your answers in parts (a) and (b). d) Determine the percentage change in price if market rates decline by 1%. Determine the actual relative change in bond prices using the intrinsic values for each rate. Compare this result with those obtained using the formulas with the modified duration only and with the modified duration and convexity together.
True Value Hardware relies on its ________ to coordinate and carry out activities that provide shoppers with the hardware and home improvement products they need at affordable prices along with top-notch customer service
A) suppliers B) internal value chain C) distributors D) portfolio network E) internal supply chain
Caroline is writing a business letter to a German client. What should she do as she prepares the letter?
A) Use jargon to introduce the client to U.S. culture. B) Use longer sentences and paragraphs to make her letter look more formal. C) Use words that have several meanings. D) Observe the receiver's title and rank.