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Part 1

Company XYZ closed at

$104.89

per share with a P/E ratio of

12.46.

Answer the following questions.

a.	How much were earnings per share?
b.	Does the stock seem overpriced, underpriced, or about right given that the historical P/E ratio is 12-14?

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Part 1

a. How much were earnings per share?

$enter your response here

(Round to the nearest cent as needed.)

Part 2

b. Based on the fact that Company XYZ stock historically trades at an average P/E ratio of 12-14, does the stock price seem overpriced, underpriced, or about right?

about right, underpriced, overpriced.

Find the monthly interest payment in the situation below.

Vic bought a new plasma TV for

$1900.

He made a down payment of

$700

and then financed the balance through the store. Unfortunately, he was unable to make the first monthly payment and now pays

5%

interest per month on the balance (while he watches his TV).

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Part 1

What is Vic's monthly interest payment?

$enter your response here

(Round to the nearest dollar as needed.)

How much must be deposited today into the following account in order to have

$70,000

in

5

years for a down payment on a house? Assume no additional deposits are made.

An account with monthly compounding and an APR of

6%

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Part 1

$enter your response here

should be deposited today.

(Do not round until the final answer. Then round to the nearest cent as needed.)

Find the annual percentage yield (APY) in the following situation.

A bank offers an APR of

6.7%

compounded daily.

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Part 1

The annual percentage yield is

enter your response here%.

(Do not round until the final answer. Then round to two decimal places as needed.)

Compute the total and annual returns on the described investment.

Six

years after buying

50

shares of XYZ stock for

$40

per share, you sell the stock for $2800.

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Part 1

The total return is

enter your response here%.

(Do not round until the final answer. Then round to one decimal place as needed.)

Part 2

The annual return is

enter your response here%.

(Do not round until the final answer. Then round to one decimal place as needed.)

Use the appropriate compound interest formula to compute the balance in the account after the stated period of time

$14,000

is invested for

7

years with an APR of

5%

and quarterly compounding.

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Part 1

The balance in the account after

7

years is

$enter your response here.

(Round to the nearest cent as needed.)

The table to the right shows expenses and income for an individual. Find the net monthly cash flow (it could be negative or positive). Assume that salaries and wages are after taxes, and assume

1month=4weeks.

Income	Expenses
Salary: $2100/month	Rent: $1130/month
	Groceries: $90/week
	Utilities: $130/month
	Health insurance: $400 semiannually
	Car insurance: $600 semiannually
	Gasoline: $30/week
	Miscellaneous: $370/month
	Phone: $85/month

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Part 1

The net monthly cash flow is

$enter your response here.

(Round to the nearest dollar as needed.)