State the key characteristics of active fund management and passive fund management, focusing on how the objectives of active management differ from those of passively managed funds.

Q: Big Rock’s directors are looking to expand into a new suite of services. Although they  are doing qu...

A: When a new venture requires a large amount of funding, the company can raise fund through equity, de...

Q: Which of the following statements is CORRECT? Assume that the project being considered has normal ca...

A: WACC is the required rate of return, where as IRR is the actual rate of return of the project. NPV i...

Q: In Future Worth Analysis, the best alternative when there is a fixed amount of capital to invest is ...

A: In future worth analysis, future value of benefits and future value of costs are calculated. 

Q: A student loan of R6978 is to be repaid by 18 equal monthly instalments. Assuming that instalments a...

A: Loan amount (PV) = R6978 Interest rate = 18% Monthly interest rate (r) = 18%/12 = 1.50% Number of mo...

Q: A 5-year project will require an investment of $100 million. This comprises of plant and machinery w...

A: Data given: Market price = $500 per share. D1= $4 per share  Growth  rate = 9% per year for an indef...

Q: Zebra Corporation currently has 2,500,000 shares of stock outstanding that sell for RM45 per share. ...

A: Since you have asked multiple questions, we will solve the first question for you. If you want any s...

Q: A $1,000, 9.5% coupon Government of Canada bond has 10 years remaining until its maturity. It is cur...

A: A Bond refers to an instrument that represents the loan being made by the investor to the company an...

Q: Fatimah pays monthly rent of $520 for her townhouse. If she bought the property, the mortgage loan, ...

A: When a series of deposits or payments are made of equal amounts at equal intervals of time, it is ca...

Q: Mrs. Go make deposits that forms a geometric gradient that increases at 6%per month for 1 year. She ...

A: Annuity represents the equal payments made constantly and gradient for annuity shows the constant in...

Q: 1.  If the yield to maturity for a two year zero coupon bond is 5.8% and the yield to maturity for a...

A: Since you have asked multiple questions, we will solve the first question for you. If you want any s...

Q: Cash Conversion Cycle. Will each of the following events increase or decrease cash conversion cycles...

A: Cash conversion cycle represent the number of days taken by the company to convert its goods into ca...

Q: Commercial banks are often restricted by Central banks to hold sufficient capital. Why is such a res...

A: A commercial bank may be a financial institution that accepts deposits, provides bank account servic...

Q: If the discounted amount is P8200 while the discount rate is 22% then wha amount of the money? O 114...

A: Loans are given at the discount to the future value of money and this discount on money represents t...

Q: 1. What are the current financial issues that can affect the operating environment of a multinationa...

A: 1. Multinational corporations are much more common today than they used to be. Many companies have f...

Q: Compute the future amount of the money which has annuity of 888 in 5 years if it is compounded month...

A: Monthly payment (P) = 888 Interest rate = 11% Monthly interest rate (r) = 11%/12 = 0.916666666666667...

Q: The interest rate for an investment is 7% pa compounded monthly. Find the effective interest rate pa...

A: The effective annual rate (EAR) is the actual rate of return earned after taking the compounding eff...

Q: now costs $25.25, and the price has increase exponentially, write an equation that will - Barnaby's ...

A: Future value:  Because of the basic principle of the time value of money, one dollar now is worth mo...

Q: A business is increasing by 10% for 8 years. If the sales in year 1 is $ 22,000, what is the present...

A: Present value = sum of present value of all sales figures for years 1 to 8. This can be treated as a...

Q: New parents wish to save for their newborn's education and wish to have $37,000 at the end of 18 yea...

A: Given  P=$37,000 r= 7.8% n=1 t=18 years

Q: Find the effective rate of the compound interest rate or investment. (Round your answer to two decim...

A: The effective rate of interest is calculated as: = [(1 + i)^number of periods] - 1

Q: We are considering the purchase of a $760,000 computed based inventory management system. It is in c...

A: CCA is the deduction from the value of the asset over the years of its life. It has a set of rates d...

Q: $3310 financed was paid off early. Find the unearned interest by using the actuarial method if the r...

A: Actuary method of calculating unearned interest is the process of distributing the payments made on ...

Q: Compare and contrast banking to non-banking institution. How these greatly affect the business indus...

A: Non-banking institutions are an important element and part of the financial market. They, along with...

Q: The returns on the Bledsoe Small-Cap Fund are the most volatile of all the mutual funds offered in t...

A: Sharp ratio It is a measure of risk adjusted return. In other words, it tells about the excess retur...

Q: A mortgage balance of $25,o00 is to be repaid over a 10-year term by equal monthly payments at 5.6% ...

A: Here,

Q: An endowment fund is providing an annual scholarship of P50,000 for the first five years, P60,000 fo...

A: Present Value:  The present value is the value of cash flow stream or the fixed lump sum amount at t...

Q: If money is worth 12% compounded bimonthly, what quarterly savings is required in order to have P320...

A: We need to use future value of annuity formula to calculate quarterly payment PMT =FV*i(1+i)n  -1 wh...

Q: 1. Alleyne thinks that projects should be selected based on their NPVs. Assume all cash flows occur ...

A: Given, The capital budget is $5,000,000. The project A, project B and Project C are available for in...

Q: You want to buy a house that has a purchase price of 190,000. You plan to make a down payment of 10%...

A: “Hi There, thanks for posting the question. But as per Q&A guidelines, we must answer the first ...

Q: Jim has an annual income of $300,000. Jim is looking to buy a house with monthly property taxes of $...

A: Here, To Find: Maximum monthly mortgage payment =?

Q: Activity: Complete the table:( /2 cw) Principel Rate Time Interst Matrity Vale CI) 20,200 9% 4yors 1...

A: Interest is defined as the payment from the borrower or the deposit takers, basically financial inst...

Q: How can banks safeguard their information security?

A: Protecting information and information systems from illegal access, usage, disclosure, interruption,...

Q: Bond valuation and yield to maturity Personal Finance Problem Mark Goldsmith's broker has shown him ...

A: Bond value: A bond's value is calculated by discounting the bond's predicted cash flows to the prese...

Q: If the yield to maturity for each bond remains at 9%, what will be the price of each bond 1 year fro...

A:   Bond A Bond B Bond C Face Value  $      1,000.00  $      1,000.00  $      1,000.00 Coupon rate...

Q: What amount of money deposited 35 years ago at 8% interest would provide a perpetual payment of $10,...

A: A perpetual payment is one that goes on forever. We will need to compute the present value of the pe...

Q: 1.5 Mr Mol plan investment with a months plus an additional N$2000 at the end of 240 months. Dete th...

A: A bond is defined as the financial instrument that is used to raise capital from the market at a sta...

Q: Magnum plans to retire in 28 years with an amount of $2,500,000. His financial advisor has found a b...

A: Period (t) = 28 Years Interest rate (r) = 5% Future value (FV) = $2,500,000  

Q: Ex. You anticipate a tuition liability of $40,000 per year at the end of 3 and 4 years from now. Wha...

A: The risk of loss in investment due to changes in interest rates is known as interest rate risk. It c...

Q: Find the accumulated amount of R538 invested at 9% pa for 5 years.

A: Investment (PV) = R538 Interest rate (r) = 9% Period (n) = 5 Years

Q: How much should be placed in this account at the end of each quarter if the annual interest rate is ...

A: Sinking Fund: It is the fund set aside to contain money by the company to pay off the debt in the f...

Q: A bank offers all savings accounts 5% interest compounded annually. If one account has a principal o...

A: An account doubles when the present value becomes 2 times of itself. In order to become two times, i...

Q: Leonard Motors is trying to increase its international export business. It is considering several al...

A: The cost associated with the maintenance of machinery or equipment is known as maintenance and opera...

Q: Lisa has a $37,500 student loan at 3.15% compounded quarterly amortized over 16 years with payments ...

A: Given: Particulars Amount Loan(PV) $37,500 Interest rate 3.15% Years 16

Q: If you sign a discount note for $4,400 at a bank discount rate of 8%, for 90 days, what is the effec...

A: Effective annual rate is defined as the actual rate that is earned on the investment. It shows the a...

Q: A $290,000 house in Hamilton was purchased with a down payment of 20.00% of its value and a 20 year ...

A: Here,

Q: Big Rock has several investment portfolios with a local mutual fund company. One of the company's di...

A: The formula for the calculation of Sharpe ratio is as follows: Sharpe ratio=Expected return on portf...

Q: Consider a project with inflows of $20,000 and outflows of $13,000. If the tax rate is 33%, and if t...

A: Annual inflow (A) = $20000 Annual outflow (O) = $13000 Tax rate (T) = 33% Let D = Depreciation

Q: xactly 140 years ago my great grandmother deposited $190 in a large bank. She forgot all about the d...

A: Here we can use the concept of time value of money. As per the concept money earns interest and henc...

Q: Yawi has a medium-size trucking company that distributes appliances within Metro Manila. Fuel consum...

A: The discounted cash inflows or outflows of future payments or receipts are known as the equivalent p...

Q: Suppose the yield on a 10-year T-bond is currently 5.05% and that on a 10-year Treasury Inflation Pr...

A: A Bond refers to an instrument that represents the loan being made by the investor to the company an...

Flow of Funds

The flow of funds is the financial accounts of the nation, which monitor and control the cash flow among various sectors or industries, or markets. Central banks use these flow of funds statements to acquire macroeconomic data, to publish cash inflow and cash outflow statements of the nation. This flow of funds system is utilized to identify economic activity and changes in the economy. It is used by Federal Reserve to determine the Gross Domestic Product (GDP) of the nation and to implement monetary policy and fiscal policies.