ST113 Worksheet 3

Like many stock analysts, Lydia believes that program trading greatly decreases the volatility of stock market prices. True or False True False 具喝 dtv MacBook P

Under normal liquidity management, deposit drains and loan commitment disbursement should not cause any major concerns for the financial institution. Major liquidity problems can arise where deposit drains are abnormally large; unexpected abnormal deposit drains (shocks) these may occur for all of the following reasons EXCEPT: a. The recent bankruptcy of a domestic bank sparks fear amoung depositors of a possible similar occurrence at another financial institution. b. Speculations of ongoing liquidity problems of a particular financial institution compared to its competitors´. c.  The sudden withdrawal of funds by a significant number of depositors due to a major financial crisis taking place in the local economy. d. The sudden change in preference by investors from holding stocks and bonds to certain bank related deposits instruments.

To better plan for future growth of the restaurant, Karen needs to develop a system that will enable her to forecast food and beverage sales by month for up to one year in advance. Table shows the value of food and beverage sales ($1000s) for the first three years of operation. Food and Beverage Sales for the Vintage Restaurant ($1000s)             Month First  Year Second Year Third Year                 January 242 263 282     February 235 238 255     March 232 247 265     April 178 193 205     May 184 193 210     June 140 149 160     July 145 157 166     August 152 161 174     September 110 122 126     October 130 130 148     November 152 167 173     December 206 230 235       Managerial Report Perform an analysis of the sales data for the Vintage Restaurant. Prepare a report for Karen that summarizes your findings, forecasts, and recommendations. Include the following: A time series plot. Comment on the underlying pattern in the time series.…

Which of the following statements is correct for the Black-Scholes model?     A) The price of an American call written on a stock is: c = SN(d1)-Ke-rTN(d2)     B) The stock price at a future point in time follows a log-normal distribution.     C) The continuously compounded return on the stock follows a log-normal distribution.     D) Black-Scholes prices may allow for arbitrage opportunities. Please explain and justify your choice.

The Free Cash Flow model has the following advantage over the Dividend Growth model: In the case of variable growth, it does not require the calculation of any horizon value. It can be applied even if growth rates are unknown. It can be applied to companies with variable growth in the initial years that eventually settle down to a fixed rate of growth for the long term. It can be applied to divisions of companies. O It does not require any forecasting.

Stocks with high market betas have higher expected returns than stocks with low market betas. This evidence is inconsistent withI.    The weak form efficient market hypothesisII.    The semi-strong form efficient market hypothesisIII.    The strong form efficient market hypothesis a) I, II, and III b) I and II c) I d) None of I, II, and III

Suppose that you work at a local food manufacturer and are given the task of investigating your company's seasonal sales patterns over the past 10 years (2011 to 2020). After adjusting your sales values for inflation, you calculate the following seasonal sales averages (in millions): Spring: 39 Summer: 46 Fall: 32 Winter: 23 Use this information to seasonally adjust your 2021 Winter sales total of 29 million. Round your answer to two decimal points and omit any units (1.23 NOT $1.23 million).

7:17 PM O A D Å ןה.ןא 288 I31) B/s Reserve Board interest-rate increases. Create a spreadsheet to compare the difference in monthly payments for a K552,451 loan having 60 monthly payments for a select number of interest rates. Use 3% as the base APR and go as high as an APR of 12%. Required: Make your spreadsheet flexible enough to be able to look at the impact of the different interest rates for different loan amounts and different repayment periods. Question Two (Evaluating Projects/probabilistic analysis) Malama's Cafe, Inc., is considering investment in two alternative capital budgeting projects. Project A is an investment of ZMK75000 to replace working but obsolete refrigeration equipment. Project B is an investment of ZMK 150000 to expand dining room facilities. Relevant cash flow data for the two projects over their expected 2-year lives are as follows: PROJECT A YEAR ONE YEAR TWO Probability Cash Flow Probability Cash Flow 0.18 ZMK O 0.08 ZMK O ZMK 50,000 ZMK 100, 000 0.64 0.84…

Solve for the predicted values of y and the residuals for the following data. Advertising 12.5 3.7 21.5 60.0 37.6 6.1 16.6 41.2 Sales 141 55 338 994 542 89 126 379 (Do not round the intermediate values. Round your answers to 4 decimal places, e.g. 1.7585.) y Predicted ( ŷ ) Residuals (y – ŷ ) 12.5 141 3.7 55 21.5 338 60.0 994 37.6 141 6.1 89 16.6 126 41.2 379

b. The following table shows the number of televisions sold over the last ten years at alocal electronic store. YEAR      TV SALES 1       1502       3003        4804        6005        6306        6407       7008       8259      90010     980 i. Using trend projection, develop a formula to predict sales for years 11 and 12. Youhave to show all working. You will need to develop a table to calculate the slope andthe intercept.

Like many stock analysts, Lydia believes that program trading greatly decreases the volatility of stock market prices. True or False True False

The time series line chart below shows the total return on a stock index fund over a certain time period. Describe the overall trend in the total return for this time period. T. Rowe Price Equity Income Total Return 4.10% Am 25 0% 0.00% 2017 2018 2019 2020 2021 Kiplinger Feb 24 2021, 11 49AM EST Powered by /CHARTS

A restaurant borrows  $15,200  from a local bank for  10  months. The local bank charges simple interest at an annual rate of  4.55%  for this loan. Assume each month is  112  of a year. Answer each part below.Do not round any intermediate computations, and round your final answers to the nearest cent. If necessary, refer to the  list of financial formulas . (a) Find the interest that will be owed after  10  months.     $ (b) Assuming the restaurant doesn't make any payments, find the amount owed after  10  months.

Under normal liquidity management, deposit drains and loan commitment disbursement should not cause any major concerns for the financial institution. Major liquidity problems can arise where deposit drains are abnormally large; unexpected abnormal deposit drains (shocks) these may occur for all of the following reasons EXCEPT: a. The recent bankruptcy of a domestic bank sparks fear amoung depositors of a possible similar occurrence at another financial institution. b.  The sudden withdrawal of funds by a significant number of depositors due to a major financial crisis taking place in the local economy. c. The sudden change in preference by investors from holding stocks and bonds to certain bank related deposits instruments. d. Speculations of ongoing liquidity problems of a particular financial institution compared to its competitors´. Clear my choice

Which of the following is a factor that would increase the risk of the misappropriation of assets for a large jewelry store? Managerial salaries with no bonus compensation. The nature of the store's merchandise. The use of standard retail sales practices. Adjusting merchandise value to the lower of cost or market.

4. Explain how the logit model overcomes the problems associated with the Linera Probability Model in binary dependent variaraile model.

I need answer typing clear urjent no chatgpt Rule 144A allows large financial institutions to trade unregistered securities among themselves. True or False

DuPont, the inventor of nylon, sold its textiles unit in 2003 because the company wanted to eliminate its low-margin products and focus more on its growing biotech business. According to the BCG Growth-Share Matrix, this is an example of what should be done in the case of:* O Dogs Question marks Stars O Cash cow T&S is a travel agency that offers international and local services. The international business unit has a relative market share position equals to 40/50 = 0.8 within its class, but customers are now less attracted towards international services which has led to a decline in the average annual revenue of this market. The recommended strategy for T&S is to keep this strategic business unit under operations. According to BCG matrix, the international business unit is a Star O Cash cow O Question mark O Dog

On-Balance Sheet Items (Assets) (in millions) Cash $   10,000 Government securities      30,000 Interbank deposits        5,000 Home loans to personal finance customers      20,000 Loans to corporate customers      75,000 Total Balance Sheet Assets     $140,000     Off-Balance Sheet Items   Standby letters of credit backing corporate borrowings $  10,000 Long term unused loan commitments made to private corporations     20,000 Total Off-Balance Sheet Items    $30,000     Bank Capital   Common stock (par value) $   1,000 Surplus      1,500 Retained earnings      1,500 Subordinated debentures      2,000 Minority interest in subsidiaries      1,000 Allowance for loan and lease losses (reserves)      1,000 Non cumulative perpetual preferred stock      1,000 Intermediate term preferred stock      4,000 Equity commitment notes      2,000     Basel…

All financial institutions provide different financial products and services that expose them to different types of risks that require different risk mitigating practices and techniques. These risks include; credit risk liquidity risk, interest rate risk, market risk, foreign exchange risk, solvency risks, operational risks and model risk. Which of the following is not true about credit risk? Select one: a. Performance risk is similar to credit risk. The borrower´s performance on an operation or specific project determines the degree of transaction risk. b. Measures based on the credit quality of the debt. As ratings are ordinal measures, they are sufficient to value credit risk. c. The risk of the issuers and borrowers are evaluated in prices in a capital market setting and can be seen visibly, or through credit spreads, or as add-ons to the risk-free rate. d. Credit risk is similar to country risk, which is essentially the risk crisis in a country. Examples of…