Question 13

You want to have $13,000 saved ten years from now. How much less do you have to deposit today to reach this goal if you can earn 6% rather than 5% on your savings?

Select one:

a. $582.94

b. $721.74

c. $666.22

d. $555.18

e. $610.70

Question 14

A firm has an ROE of 8% and an ROA of 3.5%. What is the sustainable growth rate if the firm has a 40% retention ratio?

Select one:

a. 9.19%

b. 3.31%

c. 8.10%

d. 8.81%

e. 3.09%

Question 15

What is the total future value six years from now of $110 received in one year, $200 received in two years, and $800 received in six years if the discount rate is 8%?

Select one:

a. $1,269.15

b. $1,196.99

c. $1,145.56

d. $1,233.72

e. $1,152.91

Question 16

You have the following data for the ABC. What is ABC's return on assets (ROA)? Return on equity = 15%; Earnings before taxes = $30,000; Total asset turnover = 2; Profit margin = 4.5%; Tax rate = 35%.

Select one:

a. 3.9%

b. 9.0%

c. 3.6%

d. 4.5%

e. 6.4%