1. Free Cash FlowYou are considering an investment in Crew Cut, Inc. and want to evaluate the firm's free cash flow. From the income statement, you see that Crew Cut earned an EBIT of $23.09 million, paid taxes of $3.91 million, and its depreciation expense was $7.91 million. Crew Cut's gross fixed assets increased by $10.09 million from 2007 to 2008. The firm's current assets increased by $6.09 million and spontaneous current liabilities increased by $3.91 million. What is Crew Cut's operating cash flow, investment in operating capital and free cash flow for 2008, respectively in millions?A. $27.09, $10.09, $17.00B. $23.09, $10.09, $13.00C. $23.09, $11.82, $11.27D. $27.09, $12.27, $14.82

3. Debt Management RatiosTrina's Trikes, Inc. reported a debt-to-equity ratio of 1.84 times at the end of 2008. If the firm's total debt at year-end was $9.30 million, how much equity does Trina's Trikes have? A. $5.05 millionB. $9.30 millionC. $1.84 millionD. $17.11 million

2. Unbiased Expectations TheorySuppose that the current one-year rate (one-year spot rate) and expected one-year T-bill rates over the following three years (i.e., years 2, 3, and 4, respectively) are as follows:

₁R₁=4.85%, E(₂r₁) =5.85%, E(₃r₁) =6.35%, E(₄r₁)=6.70%

Using the unbiased expectations theory, what is the current (long-term) rate for four-year-maturity Treasury securities?A. 6.7000%B. 1.6340%C. 5.9375%D. 5.9352%

4. Future Value of an Annuity DueIf the future value of an ordinary, 5-year annuity is $6,400 and interest rates are 8 percent, what's the future value of the same annuity due?A. $5,925.93B. $6,720C. $6,911.99D. $6,400

5. Determinants of Interest Rate for Individual SecuritiesA particular security's default risk premium is 3.00 percent. For all securities, the inflation risk premium is 1.75 percent and the real interest rate is 2.75 percent. The security's liquidity risk premium is .45 percent and maturity risk premium is .25 percent. The security has no special covenants. What is the security's equilibrium rate of return? A. 5.20%B. 8.20%C. 1.64%D. 7.75%

6. Moving Cash FlowsWhat is the value in year 14 of a $900 cash flow made in year 5 when the interest rates are 9 percent?A. $3,007.55B. $1,954.70C. $269.32D. $1,629.00

7. Taxable Equivalent YieldWhat's the taxable equivalent yield on a municipal bond with a yield to maturity of 4.9 percent for an investor in the 35 percent marginal tax bracket? (Round your answer to 2 decimal places.) A. 7.54%B. 14.00%C. 1.72%D. 4.90%

8. Present Value of a PerpetuityA perpetuity pays $180 per year and interest rates are 6.8 percent. How much would its value change if interest rates increased to 9.3 percent? A. $450.00 decreaseB. $711.58 increaseC. $711.58 decreaseD. $450.00 increase 9. Present Value of an AnnuityWhat is the present value of a $1,900 annuity payment over 5 years if interest rates are 9 percent? A. $7,390.34B. $2,923.39C. $1,234.87D. $8,523.25 10. Selling Stock with a Limit OrderYou would like to sell 100 shares of Pfizer, Inc.(PFE). The current bid and ask quotes are $27.37 and $27.40, respectively. You place a limit sell-order at $27.39. If the trade executes, how much money do you receive from the buyer? A. $2,739B. $2,737C. $2,740D. $5,477 11. Three Years Future ValueWhat is the future value of $500 deposited for three years earning 7% interest rate annually? A. $613B. $1,113C. $113D. $500 12. Income StatementBullseye, Inc.'s 2008 income statement lists the following income and expenses: EBIT = $904,500, Interest expense = $81,000, and Net income = $585,000. What is the 2008 Taxes reported on the income statement? A. $823,500B. There is not enough information to calculate 2008 Taxes.C. $238,500D. $319,500

13. Value of a Preferred StockIf a preferred stock from Ecology and Environment, Inc. (EEI) pays $14.50 in annual dividends, and the required return on the preferred stock is 7.00 percent, what's the value of the stock?A. $1.02B. $207.14C. $101.50D. $2.07

14. Zero Coupon Bond PriceCalculate the price of a zero coupon bond that matures in 7 years if the market interest rate is 4 percent. (Round your answer to 2 decimal places.)

A. $960.00B. $757.86C. $1,000.00D. $759.92

15. Solving for RatesWhat annual rate of return is earned on a $2,800 investment when it grows to $6,100 in twenty years?A. 2.18%B. 1.18%D. 3.97%C. 3.78%

16. Interest-on-InterestConsider a $2,300 deposit earning 10 percent interest per year for 7 years. How much total interest is earned on interest (excluding interest earned on the original deposit)?

A. $2,182.05B. $161.00C. $572.05D. $1,610.00

17. Time to MaturityA bond issued by a corporation on September 1, 1989 is scheduled to mature on September 1, 2051. If today is September 2, 2009, what is this bond's time to maturity?

A. 51 yearsB. 62 yearsC. 20 yearsD. 42 years

18. Compounding with Different Interest RatesA deposit of $790 earns interest rates of 10.9 percent in the first year and 7.9 percent in the second year. What would be the second year future value? A. $1,728.52B. $938.52C. $876.82D. $945.32 19. Debt Management RatiosTierre's Ts, Inc. reported a debt to equity ratio of 3.7 times at the end of 2008. If the firm's total assets at year-end were $15.7 million, how much of their assets are financed with equity? A. $12.36 mB. $4.24 mC. $58.09 mD. $3.34 m 20. Liquidity and Asset Management RatiosOasis Products, Inc. has current liabilities = $11.1 million, current ratio = 1.60 times, inventory turnover ratio = 12.1 times, average collection period = 21 days, and sales = $113 million. What is the value of their cash and marketable securities? (Consider a 365 days a year.) A. $9,338,843B. $1,919,787C. $18,519,056D. $17,760,000