Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please i need with steps and correct answers rd=6%;rps=5.8%;rs=12% The tax rate is : T=40%; What is the WACC of XYZ? Question 2 Assume inflation
please i need with steps and correct answers
rd=6%;rps=5.8%;rs=12% The tax rate is : T=40%; What is the WACC of XYZ? Question 2 Assume inflation is expected to be 3% next year, 5% the following year, and 6% thereafter. In addition, the real interest rate (r) is 4%, and given that the equation of the maturity risk premium is: MRP1=0.6%(t1) a. Calculate the IP of 1 year, 2 years, and 10 years. b. Find the maturity risk premium (MRP) of 1 year, 2 years, and 10 years. c. Find the appropriate nominal rates of 1 year, 2 years, and 10 years. Question 3 Consider a five-year bond with a par value of $2,000 and a 8% coupon rate. Interest is paid annually. Calculate the bond price in the following cases a. Similar bonds in the market have a discount rate or (YTM) of 4%. b. Similar bonds in the market have a discount rate or (YTM) of 12%. Question 4 Given the following data: a. Find the expected return. b. Find the variance (2). c. Find the standard deviation (). Question 5 Consider the risk-free rate at 3%, the expected inflation is 1,5% for the next 2 years. Currently, a 2 -year Treasury security is yiclding 6,2%. What is the maturity risk premium for the 2-year security? Question 6 XYZ enterprises' bonds currently sell for 1050 \$. They have 6-year maturity, an annual coupon of 755 and a par value of 1000 s. What is their current yield? Question 7 Given the following data An individual has an investment portfolio composed by stocks A and B invested as follows 35000 in Stock A \& 40000 S in Stock B. a. What is the portfolio beta? b. What is the total return of the portfolio? Question 8 Assume that the risk-free rate is 6% and the expected market return is 13%. What is the expected return of Stock XYZ with a beta of 0,7 ? Question 9 Assume that the risk-free rate is 6% and the market premium is 13%. What is the expected return of Stock XYZ with a beta of 0,7 ? Question 10 Given that the expected total return or the YTM is 12%, find the current yield and the capital gains yield for a 10-year, 9% annual coupon bond that sells for $887, and has a face value of $1,000. Question 11 a. What is the value of a 10 -year, 10% annual coupon bond, if rd=10%, with a face value of 1000$ ? b. What's the value of a 10-year bond outstanding with the same risk but a 13% annual coupon rate? c. What is the value of a 10 -year, 10% semiannual coupon bond, if rd=13%, with a face value of 1000$ ? Question 12 XYZ's recently paid a dividend of $2 per share. and sales revenue is expected to grow at 3%. How much should you pay today to purchase one share of this stock if you wanted to earn a return of 9% Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started