Solve, the attached questions with clear explanations.

13. Lovell Co. purchased preferred stock in another company. The preferred stock's before-tax yield was 13.2%. The corporate tax rate is 40%. What is the after-tax return on the preferred stock, assuming a 70% dividend exclusion? a. 12.55% b. 14.52% C. 11.62% d. 11.15% e. 11.27% 14. Which of the following statements is CORRECT? a. A reduction in inventories would have no effect on the current ratio. b. An increase in inventories would have no effect on the current ratio. c. If a firm increases its sales while holding its inventories constant, then, other things held constant, its inventory turnover ratio will increase. d. A reduction in the inventory turnover ratio will generally lead to an increase in the ROE C. If a firm increases its sales while holding its inventories constant, then, other things held constant, its fixed assets turnover ratio will decline. 15. Companies E and P each reported the same earnings per share (EPS), but Company E's stock trades at a higher price. Which of the following statements is CORRECT? a. Company E probably has fewer growth opportunities. b. Company E is probably judged by investors to be riskier. C. Company E must have a higher market-to-book ratio. d. Company E must pay a lower dividend. c . Company E trades at a higher P/E ratio. 16. If the CEO of a large, diversified, firm were filling out a fitness report on a division manager (i.c.. "grading" the manager), which of the following situations would be likely to cause the manager to receive a BETTER GRADE? In all cases, assume that other things are held constant. The division's basic earning power ratio is above the average of other firms in its industry. b, The division's total assets turnover ratio is below the average for other firms in its industry. C. The division's debt ratio is above the average for other firms in the industry. d. The division's inventory turnover is 6. whereas the average for its competitors is 8. The division's DSO (days' sales outstanding) is 40, whereas the average for its competitors is 30. 17. Ryngard Corp's sales last year were $27,000, and its total assets were $16,000. What was its total assets turnover ratio (TATO)? a. 1.57 b. 1.64 C. 1.49 d. 1.94 e. 1.69Furr 4 The Capital Badgering Process Likewise. the formula for the future value of an annuity due requires ; modification: FVADAX (+1)"-1 2-1 What is the future value of a 15-year annuity of $1.800 per period where Payments come at the beginning of each period? The interest rate is 12 percy ity dur 28. What is the present value of a 10-year annuity of $3,000 per period in which payments come at the beginning of each period? The interest rate is 12 percent. PVAD = A X +1 Advanced Problems 29. Your grandfather has offered you a choice of one of the three following alternatives: $7.500 now: $2,200 a year for nine years; or $31,000 at the end of nine years. Assuming you could earn 10 percent annually, which alternative should you choose? If you could earn 11 percent annually, would you still choose the same alternative? wired 30. You need $28,974 at the end of 10 years, and your only investment outlet is an 8 percent long-term certificate of deposit (compounded annually). With the cer- tificate of deposit. you make an initial investment at the beginning of the first year. 4. What single payment could be made at the beginning of the first year to achieve this objective? b. What amount could you pay at the end of each year annually for 10 years to achieve this same objective? 31. Beverly Hills started a paper route on January 1. Every three months, she deposits $550 in her bank account, which earns 8 percent annually but is compounded quarterly. Four years later, she used the entire balance in her bank account to invest in an investment at 7 percent annually. How much will she have after three more years? 32. Franklin Templeton has just invested $9,260 for his son (age one). This money will be used for his son's education 18 years from now. He calculates that he will need $71,231 by the time the boy goes to school. What rate of return will Mr. Templeton need in order to achieve this goal? 33. Mr. Dow bought 100 shares of stock at $14 per share. Three years later, he sold the stock for $20 per share. What is his annual rate of return? 34. C. D. Rom has just given an insurance company $35,000. In return, he will receive an annuity of $3,700 for 20 years. At what rate of return must the insurance company invest this $35,000 in order to make the annual payments? 35. Betty Bronson has just retired after 25 years with the electric company. Her total pension funds have an accumulated value of $180,000, and her life expectancy7 Outline the process used by futures exchanges to remove the credit risk of individual participants. [2] Table I below shows part of the operation of a margin account for a short position in two gold futures contracts. The initial margin is US$2,000 per contract and each contract is for delivery of 100 ounces of gold. The closing futures prices are in USS per ounce of gold. Copy the table into your answer book and fill in the entries in the blank columns. Table 1 Operation of the margin account for two gold futures contracts. Date Closing Daily Gain Cumulative Margin Futures (Loss) Gain (Loss) Account Price Balance US USS USS USS Futures price at which contract is entered into on: May 3rd 400 May 3rd 396-5 May 4th 399 4 May 5th 400.4 May 6th 399 7 May 7th 405.9 May 8th 397.9 [6] (ili) Describe briefly two major differences between the trading of currency futures contracts on an exchange and the trading of forward currency contracts in the Over-the-Counter (OTC) market. [2] [Total 10] Write down a formula for the after tax return for an investment whose dividend is d and capital gain is g- [1] State any assumptions that you have made in this formula. (iii) Describe what other factors an individual will need to take into account in practice to determine his after tax return. [3]GDP Calculation: Consider the following table of prices and production for a small country: 2019 2020 Price Quantity Price Quantity Hand Sanitizer $2 100 580 120 Movie Tickets $20 100 520 20 a. Calculate nominal GDP in each year. b. Calculate real GDP in each year. c. Calculate the growth rate of nominal GDP d. Calculate the growth rate of real GDP. e. Is the increase in nominal GDP from part (c) due to an increase in prices, an increase in production, or both? Explain. 1. For each of the following, state whether the action would impact U.S. GDP in 2020. If applicable, state the expenditure category (or categories) it would impact fi.e. C, I, G, X, or MJ. Unless otherwise noted, assume that all production occurs in the U.S. in 2020. a, In 2016 I bought an iphone for $700. In 2020 1 sell it back to Apple for $100. b. Soybeans are grown and harvested in Minnesota, and then shipped to consumers in China. C. An iphone is manufactured in China and sold in Minneapolis. d. You buy one share of Tesla stock for $400, and sell it for $435. e. Tesla builds a new factory in Texas. 2. You friend says that GDP per person is completely useless as a measure of living standards since it doesn't directly measure environmental standards, life expectancy, or happiness. Do you agree or disagree? Explain. 3. For each of the following. draw a production function with physical capital (K) on the x- axis. Illustrate the impact of each of the following (you should draw a new production function for each part - each part is separate): a. Foxconn (a Chinese company) opens a new factory in Wisconsin. b. Joe Biden is elected president and sharply reduces tuition for students who attend public colleges. i. Illustrate the short-run impact on the production function. il. On a new graph, illustrate the long-run impact the production function. c. Due to the coronavirus (COVID-19), many people become sick, schools close, and going out in public is discouraged. i. Illustrate the short-run impact on the production function fie. the production function for the next year or sol. Il. On a new graph, illustrate the impact on the long-run production function [i.e. the production function 5+ years from now), assuming that the total number of deaths in the U.S. in 2020 and 2021 are roughly the same as