Solve the following problems 1. Accumulate P 8, 400 for 2 years at 7% converted monthly.

Q: How do anthropological perspectives on debt help us make sense of modern-day financial markets?

A: Whether focused on family or with kula, anthropology's attention to credit and debt stretches back…

Q: % ( assume What is the current yield of a bond with a 8% coupon, 5 years until maturity, and a price…

A: To calculate current yield we will use the following formula   Current yield = Annual coupon…

Q: Bernard co. has 7% coupon bonds on the market that have 13 years left to maturity. The bonds will…

A: Current bond price will be equal to present value of Maturity Value and present value of interest…

Q: A 11-year, semiannual coupon bond sells for $938.52. The bond has a par value of $1,000 and a yield…

A: Price of the bond (P0) = $938.52 Maturity value of the bond (Z) = $1000 Semiannual yield to maturity…

Q: the correct answer. 1. Which of the following is not among the risks that need to be evaluated in…

A: There are many types of risk involved in life that need to be covered by financial planning and risk…

Q: Choose the correct answer. 4. Financial goals are classified as to duration as follows, except a.…

A: Financial Industry Regulatory Authority (FINRA) defines the three types of duration for  financial…

Q: 13. A discounted loan of $3,000 at a simple discount rate of 6.5% is offered to Mr. Jones. If the…

A: 1. Interest amount = (face Value - amount received = 3000 - 2869.11 = $130.89) 2. Time when the…

Q: Suppose Bank is trading share at 17$ today. The company pays dividend of 0.25. The analysts claimed…

A: Expected return = (Target Price - Current price + dividend) / Current price

Q: ABC Co. bought 1,000 CALL options of XYZ Corporation with a strike price of ₱52 at ₱2.75 per option.…

A: Exercise of option - Call option is a right to buy the stock at the strike price on expiry date, if…

Q: Find the interest due loan of 5,500 at 3/4% simple interest for 1/4 year, using exact interest

A: To calculate the interest amount we will use exact interest formula as follows:   Interest amount =…

Q: 24) In 1999, the euro was trading at $0.84 per euro. If the euro is now trading at $0.99 per euro,…

A: The euro's international role is principally backed by a deeper and more comprehensive EMU,…

Q: Explain the Currency crisis, Banking Crisis and Foreign Debt Crisis

A: In the world of finance, we often see or hear about one crisis or the other. The 2008 financial was…

Q: ABC common stock is expected to have extraordinary growth in earnings and dividends of 22% per year…

A: Current dividend = $4 Growth rate for 2 years = 22% Growth rate after 2 years = 3% Required rate of…

Q: d. Monthly e. Continuously

A: Time value of money (TVM) refers to the method used to measure the amount of money at different…

Q: Which of the following rebalancing methodologies will ha market impact cost? Buy and Hold Momentum…

A: Rebalancing a portfolio It is a process by which the weights of the assets of a portfolio are…

Q: An investor has portfolio of shares consisting of P2,500 investment in each of twenty different…

A: Portfolio beta = 3.00 Beta of sold share = 3.00 Beta of bought share = 2.00 Share in the portfolio…

Q: The cost price of 35 pairs of sport shoes was $350 per pair. AG Sport Center plan to sell all the…

A: Concept. Gross profit = selling price - cost of goods sold. Hence , Selling price = gross profit +…

Q: 3) When firms increase their debt-equity ratio, we find: Group of answer choices The ROE always…

A: We know that debt is the cheaper source of finance, if any company uses more debts in capital…

Q: Use the following table:                      Present Value of an Annuity of 1 Period…

A: Concept. IRR ( internal rate of return) Internal rate of return is method of calculating investments…

Q: Consider the following cash flows. The interest rate is 8%. What is the total wealth after 2 years…

A: Present value of a future amount With interest rate or discount rate (r), period (n) and future…

Q: Modes of Payment Premium Factor Semi-annually 0.51 Quarterly 0.26 Monthly 0.0908 201.12 307.52…

A: Insurance companies give option to clients to pay the monthly or yearly payments or any other way…

Q: With a decrease in time preference, the supply of loanable funds will increase.   Select one: True…

A: Loanable funds includes all forms of credit, such as loans, bonds, or savings deposits. There is an…

Q: 13. A discounted loan of $3,000 at a simple discount rate of 6.5% is offered to Mr. Jones. If the…

A: The amount of discount depends on the period and interest rate and amount of the loan taken and cash…

Q: What is the annualized investment rate% on a Treasury bill that you purchase for $8000 that will…

A: T-bills refers to a debt securities or government bonds issued by the central bank on behalf of the…

Q: With reference to IAS 16 (Property, Plant and Equipment), discuss the differences between “the cost…

A: Except when another standard requires or enables other accounting treatments, such as assets…

Q: At what nominal rate compounded quarterly will payments of P 800 at the beginning of each 3 months…

A: Here, Quarterly Payment is P800 Time Period is 5 years Annuity Type is Annuity Due Borrowed Amount…

Q: What is the portfolio beta?

A: To calculate the portfolio beta we will multiply weight of each stock with beta of each stock.

Q: How are the Dow Jones industrial Average and the S&P 500 index different?

A: 1. DJIA tracks the stock prices of 30  large cap US companies. 2.DJIA is a price-weighted index 3.…

Q: 16) Suppose Bank is trading share at 20$ today. The company pays dividend of 0.25. The analysts…

A: To calculate the stock price we will use the  following information   Expected return =…

Q: Calculate the expected return, variance, and standard deviation for a portfolio of four equally…

A: The expected return of the portfolio is the return that an investor gets based on the weightage…

Q: Mang Moises needed a refrigerator for his canteen. The refrigerator, which costs P:26,000, may be…

A: In financing, amortization is the amount of loan, in which principal loan paid according to the…

Q: Rudolf Company had the following items in its “Cash and cash equivalents” account as of December 31,…

A: Cash and Cash Equivalent majorly includes 1) Cash in Hand 2) Cash at Bank 3) Short Term investment (…

Q: 4. In a CDS the accrual payment is a payment made by CDS and occurs when the to CDS defaults a.…

A: The answer is option b. seller; buyer; reference entity. In a CDS, the accrual payment is a payment…

Q: Speculating with Currency Call Options. ABC Inc.,  purchased 75,000 units call option on British…

A: An option is a financial derivative that gives the buyer the right to buy or sell the underlying…

Q: Beginning Balance Ending Balance Assets $ 131,000 334,000 579,000 786,000 401,000 255,000 $…

A: Operating assets - are those assets that are required to support its business operation and…

Q: Which is not a benefit of debt to the corporation? a. interest payments are tax deductible b. when…

A: When debt is borrowed heavily,  it increases the burden of interest and principal repayment.  When…

Q: What would be your annualized discount rate% on the purchase of a 170-day Treasury bill for $4700…

A: Annualized discount rate can be calculated as: = (Maturity amount - Initial amount) / Initial amount…

Q: In 2019, Scotiabank's interest rate on GICS was 1% for a 1-yr term and 2.5% for a 10-yr term.…

A: Data given: Rate on GICs for 1 year term=1% Rate on GICs for 10 year term=2.5% Average annual return…

Q: Discuss to what extent deferred tax accounting can be used for income smoothing.

A: Deferred tax is referred as an income taxes for the tax on the losses or profits of the company…

Q: Tower City aims to construct a new bypass between two main routes that will reduce commuter travel…

A: Here, Cost of Route is $15 million Cost Savings is 17500 people $100 per year Cost Expense is $7500…

Q: Using the spot and outright forward quotes in the table below, determine the corresponding bid-ask…

A: Answer -    Formula for Bid Ask Spreads in Points = Month Ask Quote - Months Bid Quote

Q: 22) The current exchange rate is 0.85 euros per dollar, but you believe the dollar will decline to…

A: The expected exchange rate between two currencies in the spot market on a specified future date. It…

Q: A waitress's base wage is $11 per hour, plus 10% automatic gratuity for all tables served. If she…

A: Gratuity is a benefit paid by an employer to their employee for services rendered.

Q: Year Investment Cash Inflow $13,000 $10,000 $1,000 $2,000 $2,500 $4,000 $5,000 $4,000 $5,000 $4,000…

A: Payback period = initiative investment/Annual cash inflows Here cash inflows per year is not…

Q: Analysts projected that Apple will have earnings per share 1$. The industry has average PE ratio of…

A: To calculate the stock price we will use the following formula   Stock price = Earning per  share*PE…

Q: ABC Co. has recently purchased ordinary shares of XYZ Co, one of its competitors, as part of a…

A: a. Call option is purchased when the share price of a company is expected to increase in the future.…

Q: uity X and Y provide the following payments: End of Year Y 1-10 1 K 11-20 2 21-30 1 K Annuity X and…

A: Annuity is a stream of constant regular payments.

Q: rate is 1,000,000 vehicles. Determine public project is justified (i=5%). O The project is justified…

A: The net present value of the project that is difference between the present value of cash flow and…

Q: The following statements relate to derivatives. Which of the following is FALSE? a. Swaps may have…

A: Options are contingent claims, while swaps and future contract are forward commitments. This implies…

Q: What is the expected return on common shares of Cisco Systems, Inc. (It designs, manufactures, and…

A: The expected return on common shares of Cisco Systems, Inc. is 11.356%.

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.