Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

6) (4 pts) Five years ago you invested $8000 into a stock ac another $6000. Three years ago, you invested any more money. One year

image text in transcribed
6) (4 pts) Five years ago you invested $8000 into a stock ac another $6000. Three years ago, you invested any more money. One year ago, you didn't worth $34,000. What is the dollar weighted a account over the last 5 years? unt. Four years ago, you invested So, you invested another $5000. Two years ago, you didn't invest you didn't invest any more money. Today, the stock account is eighted average return of your total investment in the stock WAA Dollar weighted average return = 7) (4 pts) Given the following his 1 pts Given the following historical returns, what was the historical risk premium for corpore bonds? What was the historical risk premium for the "Market"? Inflation: 2.7% S&P 500: 10.8% Treasury Bills: 3.5% Treasury bonds: 5.6% Corporate bonds: 6.67 Small Cap Stocks: 12.9% 6.6 -3.5 Historical Risk Premium Corp bonds = Historical Risk Premium "Market" = 8) (3 pts) are virtually free of any default risk and we call the rate of return on such debt the risk-free rate, and we will use it as a kind of investing benchmark. 9) (7 pts) Company GG most recent Sales for 2020 was $400 million with Net Income of $22 million. You forecast that Sales will increase by 8% over the next year (2021), the company will have a Ne profit margin of 6%, and there will be 8 million shares outstanding. a) Fill in the following blanks 2021 2020 $400 mil Sales Sales Net Income $22 mil Net Income

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Finance questions