Final Exam

1. Calculate the Future Value of an Annuity that has the following characteristics: (a) PMT: $2,032, (b) RATE: 6%, and (c) NPER: 10.
2. Determine how much you would be willing to pay for an annuity due that has the following characteristics: (a) PMT: $10,250, (b) RATE: 4.25%, and (c) NPER: 30.
3. How much would you be willing to pay for a bond that pays semi-annual coupon payments and has the following characteristics: (a) Years to Maturity: 10, (b) YTM: 7%, and Coupon Rate: 6.35%.
4. What is the maximum price that you would be willing to pay for a no-growth stock that has the following characteristics: (a) Dividend (Has Paid): $3.65 and (b) Required Rate of Return: 8%.
5. What is the maximum price that you would be willing to pay for a constant growth stock that has the following characteristics: (a) Dividend (Has Paid): $2.62, (b) Growth: 6.5%, and (c) Required Rate of Return: 7.5%.
6. What is the maximum price that you would be willing to pay for a non-constant growth stock that has the following characteristics: (a) Non-Constant Growth Rate: 12.3%, (b) Constant Growth Rate: 6.3%, (c) Dividend: $3.13, and (d) Required Rate of Return: 7.3%.
7. What is the current yield on a bond that has the following characteristics: (a) Price: $926.32, (b) Coupon Rate: 3.6%, (c) YTM: 4.21%, and (d) NPER: 10.
8. Calculate the YTM on a bond with the following characteristics: (a) Price: $1,123, (b) Coupon: $46.23, and (c) NPER: 10.
9. Calculate Company As weighted average cost of debt, given the following information: (a) Tax Rate: 15%, (b) Average Price of Outstanding Bonds: $852.32, (c) Coupon Rate: 4.25%, (d) NPER: 15, (e) Debt: $15,000,000, (f) Equity: $10,000,000, and (g) Preferred Stock: $2,000,000.
10. Calculate Company Bs weighted average cost of equity, given the following information: (a) Dividend: $2.33, (b) Growth Rate: 6.3%, (c) Price: $53.20, (d) Debt: $13,000,000, (e) Equity: $8,000,000, and (f) Preferred Stock: $2,000,000.
11. Calculate Company Cs weighted average cost of preferred stock, given the following information: (a) Dividend Payments: $4.23, (b) Price of Preferred Stock: $95.60, (c) Debt: $13,000,000, (d) Equity: $9,000,000, and (e) Preferred Stock: $3,000,000.
12. Calculate Company Ds weighted average cost of capital, given the following information: (a) Tax Rate: 26%, (b) Average Price of Outstanding Bonds: $1,123.50, (c) Coupon Rate (Debt): 6.5%, (d) NPER (Debt): 15, (e) Dividend: $3.26, (f) Growth Rate: 4.5%, (g) Price: $35.20, (h) Dividend on Preferred Stock: $2.36, (i) Price of Preferred Stock: $52.30, (j) Debt: $13,000,000, (k) Equity: $9,000,000, and (l) Preferred Stock: $5,000,000.

Note: For Problems 13 through 18 use the data provided in Table 1

Table 1: Cash Flow Summary
Year	Project A	Project B
0	-60000	-40000
1	28,900	15000
2	25,000	16000
3	18,000	17000
4	16,000	18000

1. If Company XYZ has a WACC of 7% and the two projects are independent, which project would you accept based upon NPV rules?
2. If Company XYZ has a WACC of 13% and the two projects are mutually exclusive which project would you accept based upon NPV rules?
3. What is the Internal Rate of Return for Project A?
4. What is the Profitability Index for Project B?
5. What is the Payback Period for Project B?
6. What is the Crossover Rate for Projects A and B?
7. Calculate the difference between daily and annual compounding, given the following information: (a) PV: $13,000, (b) NPER: 25, and (c) RATE: 8.5%.
8. Calculate the PMT on a mortgage, given the following information: (a) PV: $250,000, (b) RATE: 3.65%, and NPER: 25.
9. Calculate the present value of a lump sum payment with the following characteristics: (a) RATE: 6.3%, (b) NPER: 20, and (c) FV: $65,230.
10. Calculate the RATE given the following characteristics: (a) PV: $36,985, (b) FV: $65,200, and (c) NPER: 12.
11. Calculate the NPER given the following characteristics: (a) PV: $25,000, (b) FV: $134,000, and (c) RATE: 12.20%.
12. Calculate the RATE given the following characteristics: (a) PMT: $15,320 (you are paying), (b) FV: $230,000, and (c) NPER: 10.
13. Calculate the required rate of return on a companys stock that has the following characteristics: (a) Constant Growth Rate: 6.5%, (b) Price: $45.25, and (c) Dividend (Has Been Paid): $3.50.

Final Exam 1. Calculate the Future Value of an Annuity that has the following characteristics: (a) PMT: $2,032, (b) RATE: 6%, and (c) NPER: 10. 2. Determine how much you would be willing to pay for an annuity due that has the following characteristics: (a) PMT: $10,250, (b) RATE: 4.25%, and (c) NPER: 30. 3. How much would you be willing to pay for a bond that pays semi-annual coupon payments and has the following characteristics: (a) Years to Maturity: 10, (b) YTM: 7%, and Coupon Rate: 6.35%. 4. What is the maximum price that you would be willing to pay for a no-growth stock that has the following characteristics: (a) Dividend (Has Paid): $3.65 and (b) Required Rate of Return: 8%. 5. What is the maximum price that you would be willing to pay for a constant growth stock that has the following characteristics: (a) Dividend (Has Paid): $2.62, (b) Growth: 6.5%, and (c) Required Rate of Return: 7.5%. 6. What is the maximum price that you would be willing to pay for a non-constant growth stock that has the following characteristics: (a) Non-Constant Growth Rate: 12.3%, (b) Constant Growth Rate: 6.3%, (c) Dividend: $3.13, and (d) Required Rate of Return: 7.3%. 7. What is the current yield on a bond that has the following characteristics: (a) Price: $926.32, (b) Coupon Rate: 3.6%, (c) YTM: 4.21%, and (d) NPER: 10. 8. Calculate the YTM on a bond with the following characteristics: (a) Price: $1,123, (b) Coupon: $46.23, and (c) NPER: 10. 9. Calculate Company A's weighted average cost of debt, given the following information: (a) Tax Rate: 15%, (b) Average Price of Outstanding Bonds: $852.32, (c) Coupon Rate: 4.25%, (d) NPER: 15, (e) Debt: $15,000,000, (f) Equity: $10,000,000, and (g) Preferred Stock: $2,000,000. 10. Calculate Company B's weighted average cost of equity, given the following information: (a) Dividend: $2.33, (b) Growth Rate: 6.3%, (c) Price: $53.20, (d) Debt: $13,000,000, (e) Equity: $8,000,000, and (f) Preferred Stock: $2,000,000. 11. Calculate Company C's weighted average cost of preferred stock, given the following information: (a) Dividend Payments: $4.23, (b) Price of Preferred Stock: $95.60, (c) Debt: $13,000,000, (d) Equity: $9,000,000, and (e) Preferred Stock: $3,000,000. 12. Calculate Company D's weighted average cost of capital, given the following information: (a) Tax Rate: 26%, (b) Average Price of Outstanding Bonds: $1,123.50, (c) Coupon Rate (Debt): 6.5%, (d) NPER (Debt): 15, (e) Dividend: $3.26, (f) Growth Rate: 4.5%, (g) Price: $35.20, (h) Dividend on Preferred Stock: $2.36, (i) Price of Preferred Stock: $52.30, (j) Debt: $13,000,000, (k) Equity: $9,000,000, and (l) Preferred Stock: $5,000,000. Note: For Problems 13 through 18 use the data provided in Table 1 Table 1: Cash Flow Summary Project A Project B -60000 -40000 0 28,900 15000 1 25,000 16000 2 18,000 17000 3 16,000 18000 4 Year 13. If Company XYZ has a WACC of 7% and the two projects are independent, which project would you accept based upon NPV rules? 14. If Company XYZ has a WACC of 13% and the two projects are mutually exclusive which project would you accept based upon NPV rules? 15. What is the Internal Rate of Return for Project A? 16. What is the Profitability Index for Project B? 17. What is the Payback Period for Project B? 18. What is the Crossover Rate for Project's A and B? 19. Calculate the difference between daily and annual compounding, given the following information: (a) PV: $13,000, (b) NPER: 25, and (c) RATE: 8.5%. 20. Calculate the PMT on a mortgage, given the following information: (a) PV: $250,000, (b) RATE: 3.65%, and NPER: 25. 21. Calculate the present value of a lump sum payment with the following characteristics: (a) RATE: 6.3%, (b) NPER: 20, and (c) FV: $65,230. 22. Calculate the RATE given the following characteristics: (a) PV: $36,985, (b) FV: $65,200, and (c) NPER: 12. 23. Calculate the NPER given the following characteristics: (a) PV: $25,000, (b) FV: $134,000, and (c) RATE: 12.20%. 24. Calculate the RATE given the following characteristics: (a) PMT: $15,320 (you are paying), (b) FV: $230,000, and (c) NPER: 10. 25. Calculate the required rate of return on a company's stock that has the following characteristics: (a) Constant Growth Rate: 6.5%, (b) Price: $45.25, and (c) Dividend (Has Been Paid): $3.50