Assume that you are considering the purchase of a 20-year, noncallable bond with an annual coupon rate of 9.5%. The bond has a face value of $1,000, and it makes semiannual interest payments. If you require an 9.5% nominal yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond?

Group of answer choices

$1,220.00

$980.00

$1,000.00

$1,140.00

$1,010.00

A 25-year, $1,000 par value bond has an 8.5% annual payment coupon. The bond currently sells for $825. If the yield to maturity remains at its current rate, what will the price be 5 years from now?

Group of answer choices

$835.17

$726.60

$843.52

$801.76

$626.38

Garcia Industries has sales of $207,500 and accounts receivable of $18,500, and it gives its customers 25 days to pay. The industry average DSO is 27 days, based on a 365-day year. If the company changes its credit and collection policy sufficiently to cause its DSO to fall to the industry average, and if it earns 8.0% on any cash freed up by this change, how would that affect its net income, assuming other things are held constant? Assume all sales to be on credit. Do not round your intermediate calculations.

Group of answer choices

$252.05

$236.93

$189.04

$199.12

$201.64

Last year Blease Inc had a total assets turnover of 1.33 and an equity multiplier of 1.75. Its sales were $285,000 and its net income was $10,600. The firm finances using only debt and common equity, and its total assets equal total invested capital. The CFO believes that the company could have operated more efficiently, lowered its costs, and increased its net income by $10,250 without changing its sales, assets, or capital structure. Had it cut costs and increased its net income by this amount, how much would the ROE have changed? Do not round your intermediate calculations.

Group of answer choices

9.54%

10.13%

9.71%

6.95%

8.37%

Last year Kruse Corp had $440,000 of assets (which is equal to its total invested capital), $403,000 of sales, $28,250 of net income, and a debt-to-total-capital ratio of 39%. The new CFO believes the firm has excessive fixed assets and inventory that could be sold, enabling it to reduce its total assets and total invested capital to $252,500. The firm finances using only debt and common equity. Sales, costs, and net income would not be affected, and the firm would maintain the same capital structure (but with less total debt). By how much would the reduction in assets improve the ROE? Do not round your intermediate calculations.

Group of answer choices

8.21%

8.91%

7.35%

7.97%

7.82%

Precision Aviation had a profit margin of 7.00%, a total assets turnover of 1.5, and an equity multiplier of 1.8. What was the firm's ROE?

Group of answer choices

15.88%

16.07%

22.87%

18.90%

22.11%

X-1 Corp's total assets at the end of last year were $365,000 and its EBIT was $52,500. What was its basic earning power (BEP) ratio?

Group of answer choices

13.23%

17.40%

14.10%

14.67%

14.38%