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Hello, I just wonder if you could help me with the attached Corporate Finance questions (mainly about financial performances among different types industries) all short
Hello, I just wonder if you could help me with the attached Corporate Finance questions (mainly about financial performances among different types industries) all short answer questions. I need your expert answer to prepare for my exam. Thanks
1. Would you expect a pharmaceutical firm to have a relatively high or relatively low net profit margin? Equity Multiplier? 2. Explain why NPM tends to be mean-reverting. 3. Explain why total asset turnover tends to be relatively constant. Inherent nature of a firm's line of business 4. Explain why a jewelry store would be expected to have a high profit margin. How can this be so when jewelers are so competitive (four or five within shouting distance in every mall)? 5. Using the DuPont Identity, how would you describe the financial performance that would be expected from a supermarket chain (ignore EM component)? 6. Why do pharmaceutical firms and tech firms, on average, tend to have very little, if any, long-term debt? 7. Why do utilities and auto manufactures tend to have significant levels of leverage? 8. What is the average NPM for non-financial firms in US? What statistical property does it tend to follow and why? 9. What is the current level of long-term interest rate(30-year Treasury), short-term interest rates (90-day Treasury) and the LIBOR? 10. Suppose that a well-known existing retailer(take your pick---textiles, books, household products) launches a website to sell its product via internet. IF this effort is successful would you expect it to impact the firm's NPM and/or TAT? If so, explain how. If not, explain why not. 11. Compare TPHB with one having NPM of 8.15%, an asset turnover of 0.95 times and leverage of 2.22 times. One firm is a supermarket chain and the other is jewelry store chain, Which one is which? Carefully explain. 12. Explain difference between firm's internal growth rate and its sustainable growth rate. Describe the difference mathematically. 13. Sales increases to 3590 but all other information (Net Income, Total assets, Total Liabilities) remains the same. What will happen to the firm's ROE? Are the any changes in the firm's performances? 14. Approximately what is the historical return on bonds relative to stocks?Step by Step Solution
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