G keep following their purpose and social responsibility at every and every corner in the world: “We will provide branded products and services of superior quality and value that improve the lives of the world’s consumers‚ now and for generations to come. As a result‚ consumers will reward us with leadership sales‚ profit and value creation‚ allowing our people‚ our shareholders and the communities in which we live and work to prosper.” Until now‚ P & G has become the largest consumer packaged
Premium P/E ratio Dividend yield Time value of money
case he must search for a job‚ he has remained intellectually active. Which term best describes Bob’s activity? a. Moral Hazard b. Screening c. Adverse Selection d. Signaling Answer D 3. A three-year bond has 8.0% coupon rate and face value of $1000. If the yield to maturity on the bond is 10%‚ calculate the price of the bond assuming that the bond makes semi-annual coupon interest payments. (Chapter 2) a. $857.96 b. $949.24 c. $1057.54 d. $1000.00 Response: PV = (40/1
Premium Depreciation Investment Net present value
intelligent investing. When an investor attempts to determine the worth of her shares based on the fundamentals‚ it helps her make informed decisions about what stocks to buy or sell. Without fundamental value‚ one is set adrift in a sea of random short-term price movements and gut feelings. Before we can value a share of stock‚ we have to have some notion of what a share of stock is. A share of stock is not some magical creation that ebbs and flows like the tide; rather‚ it is the concrete representation
Premium Stock Net present value Time value of money
Question 1 (5 points) In a world with no frictions (i.e.‚ taxes‚ etc.)‚ having debt is always better because it increases the value of the firm/projet. Your Answer | Score | Explanation | False | 5.00 | Correct. You understand the irrelevance of financing. | Total | 5.00/5.00 | | Question Explanation | | | Fundamental question about value creation. | Question 2 (5) the return of equity is equal to the return on debt of a project/firm Your Answer | Score | Explanation | Never true
Premium Interest Finance Net present value
Question 1 (5 points) $50 today is worth MORE than $50 tomorrow. Your Answer Score Explanation True ✔ 5.00 Correct. You understand Time value of money. Total 5.00 / 5.00 Question Explanation We have assumed time value of money is positive. Question 2 (5 points) At an interest rate of 10% it is better to have $100 today than $120 in 2 years. Your Answer Score Explanation True ✔ 5.00 Correct; it is compounding! Total 5.00 / 5.00 Question Explanation All about compounding
Premium Time value of money Investment Future value
calculator‚ Let‚ PV = $ .86‚ FV = $2.00‚ n = 8. Solve for i. i = the average growth rate. In this case i = g = 11.13%. Plugging this growth rate into the Gordon Growth Model‚ P0 = $2.00(1 + .1113) = $118.86 .13 - .1113 3. This time‚ Let‚ PV = $1.42‚ FV = $2.00‚ n = 5. Solve for i. i = g = 7.09%. Plugging this growth rate into the Gordon Growth Model‚ P0 = $2.00(1 + .0709) = $36.24 .13 - .0709 4. The Gordon Growth Model‚ or any other dividend based pricing
Premium Time value of money Dividend Net present value
accommodate. It is a productive capability or a facility. Capacity is a critical consideration for long term strategy. It is generally measured in volume of output per unit of time. Capacity is the limiting capability of a productive unit to produce within a stated time period‚ normally expressed in terms of output per unit of time. So‚ capacity is the maximum productive capability. Capacity can be measured in different ways. Capacity has different meaning to different people at different level
Premium Time Finance Term
FOR THE HP-10BII [pic] ******* NOTE: The HP calculators come from the factory with the PMTS/YR set to 12. Change this setting to 1 PMT/YR by going to #6 below. Change this setting before you do any of the time value of money problems!!!! You only have to change the PMT/YR setting one time! ********* GENERAL: Note that every HP-10BII calculator key has two functions‚ the main ones are in WHITE LETTERS and a second function in ORANGE. To access the second function‚ you simply enter the ORANGE
Premium Time value of money Net present value Rate of return
Exercise 1. (Future value) You invest a single amount of $12‚000 for 5 years at 10 percent. At the end of 5 years you take the proceeds and invest them for 12 years at 15 percent. How much will you have after 17 years? Answer: FV(5) = 12000*(1.1^5)=19326.12 FV(12) = 19326.12*(1.15^12)=103399.60 Exercise 2. (Present value) The Western Sweepstakes has just informed you that you have won $1 million. The amount is to be paid out at the rate of $50‚000 a year for the next 20 years. With a discount
Premium Time value of money Net present value Money
Project appraisal- A methodology Appraisal involves a careful checking of the basic data‚ assumptions and methodology used in project preparation‚ an in-depth review of the work plan‚ cost estimates and proposed financing‚ an assessment of the project’s organizational and management aspects‚ and finally the viability of project. It is mandatory for the Project Authorities to undertake project appraisal or atleast give details of financial‚ economic and social benefits and suitably incorporate
Premium Net present value Time value of money Economics