Details:

Complete the following problems from chapter 8 in the textbook:

· P8-9

· P8-14

· P8-27

Complete the following problems from chapter 9 in the textbook:

· P9-5

· P9-7

· 9-9

· P9-10

· P9-17

Follow these instructions for completing and submitting your assignment:

1. Do all work in Excel. Do not submit Word files or *.pdf files.

2. Submit a single spreadsheet file for this assignment. Do not submit multiple files.

3. Place each problem on a separate spreadsheet tab.

4. Label all inputs and outputs and highlight your final answer.

5. Follow the directions in the “Guidelines for Developing Spreadsheets.”

P8–9 Rate of return, standard deviation, and coefficient of variation Mike is searching

for a stock to include in his current stock portfolio. He is interested in Hi-Tech,

Inc.; he has been impressed with the company’s computer products and believes

that Hi-Tech is an innovative market player. However, Mike realizes that any

time you consider a technology stock, risk is a major concern. The rule he follows

is to include only securities with a coefficient of variation of returns below 0.90.

Mike has obtained the following price information for the period 2012 through

2015. Hi-Tech stock, being growth-oriented, did not pay any dividends during these

4 years.

Stock price Year Beginning End 2012 $14.36 $21.55 2013 21.55 64.78 2014 64.78 72.38 2015 72.38 91.80

a. Calculate the rate of return for each year, 2012 through 2015, for Hi-Tech stock.

b. Assume that each year’s return is equally probable, and calculate the average return

over this time period.

c. Calculate the standard deviation of returns over the past 4 years. (Hint: Treat

these data as a sample.)

d. Based on b and c, determine the coefficient of variation of returns for the security.

e. Given the calculation in d, what should be Mike’s decision regarding the inclusion

of Hi-Tech stock in his portfolio?

P8–14 Portfolio analysis You have been given the expected return data shown in the first

table on three assets—F, G, and H—over the period 2016–2019.

Expected return Year Asset F Asset G Asset H 2016 16% 17% 14% 2017 17 16 15 2018 18 15 16 2019 19 14 17

Using these assets, you have isolated the three investment alternatives shown in the

following table.

Alternative Investment 1 100% of asset F 2 50% of asset F and 50% of asset G 3 50% of asset F and 50% of asset H

a. Calculate the expected return over the 4-year period for each of the three

alternatives.

b. Calculate the standard deviation of returns over the 4-year period for each of the

three alternatives.

c. Use your findings in parts a and b to calculate the coefficient of variation for

each of the three alternatives.

d. On the basis of your findings, which of the three investment alternatives do you

recommend? Why?

P8–27 Portfolio return and beta Jamie Peters invested $100,000 to set up the following

portfolio 1 year ago.

Asset Cost Beta at purchase Yearly income Value today A $20,000 0.80 $1,600 $20,000 B 35,000 0.95 1,400 36,000 C 30,000 1.50 — 34,500 D 15,000 1.25 375 16,500

a. Calculate the portfolio beta on the basis of the original cost figures.

b. Calculate the percentage return of each asset in the portfolio for the year.

c. Calculate the percentage return of the portfolio on the basis of original cost,

using income and gains during the year.

d. At the time Jamie made his investments, investors were estimating that the market

return for the coming year would be 10%. The estimate of the risk-free rate of return

averaged 4% for the coming year. Calculate an expected rate of return for each stock

on the basis of its beta and the expectations of market and risk-free returns.

e. On the basis of the actual results, explain how each stock in the portfolio performed

relative to those CAPM-generated expectations of performance. What

factors could explain these differences?

P9–5 The cost of debt Gronseth Drywall Systems, Inc., is in discussions with its investment

bankers regarding the issuance of new bonds. The investment banker has informed

the firm that different maturities will carry different coupon rates and sell at

different prices. The firm must choose among several alternatives. In each case, the

bonds will have a $1,000 par value and flotation costs will be $30 per bond. The

company is taxed at a rate of 40%. Calculate the after-tax cost of financing with

each of the following alternatives.

Alternative Coupon rate Time to maturity (years) Premium or discount A 9% 16 $250 B 7 5 50 C 6 7 par D 5 10 — 75

P9–7 Cost of preferred stock Taylor Systems has just issued preferred stock. The stock

has a 12% annual dividend and a $100 par value and was sold at $97.50 per share.

In addition, flotation costs of $2.50 per share must be paid.

a. Calculate the cost of the preferred stock.

b. If the firm sells the preferred stock with a 10% annual dividend and nets $90.00

after flotation costs, what is its cost?

P9–9 Cost of common stock equity: CAPM J&M Corporation common stock has a beta,

b, of 1.2. The risk-free rate is 6%, and the market return is 11%.

a. Determine the risk premium on J&M common stock.

b. Determine the required return that J&M common stock should provide.

c. Determine J&M’s cost of common stock equity using the CAPM.

P9–10 Cost of common stock equity Ross Textiles wishes to measure its cost of common

stock equity. The firm’s stock is currently selling for $57.50. The firm expects to pay

a $3.40 dividend at the end of the year (2016). The dividends for the past 5 years

are shown in the following table.

Year Dividend 2015 $3.10 2014 2.92 2013 2.60 2012 2.30 2011 2.12

After underpricing and flotation costs, the firm expects to net $52 per share on a

new issue.

a. Determine the growth rate of dividends from 2011 to 2015.

b. Determine the net proceeds, Nn, that the firm will actually receive.

c. Using the constant-growth valuation model, determine the cost of retained earnings, rr.

d. Using the constant-growth valuation model, determine the cost of new common

stock, rn.

P9–17 Calculation of individual costs and WACC Dillon Labs has asked its financial manager

to measure the cost of each specific type of capital as well as the weighted average

cost of capital. The weighted average cost is to be measured by using the following

weights: 40% long-term debt, 10% preferred stock, and 50% common stock equity

(retained earnings, new common stock, or both). The firm’s tax rate is 40%.

Debt The firm can sell for $980 a 10-year, $1,000-par-value bond paying annual

interest at a 10% coupon rate. A flotation cost of 3% of the par value is required

in addition to the discount of $20 per bond.

Preferred stock Eight percent (annual dividend) preferred stock having a par

value of $100 can be sold for $65. An additional fee of $2 per share must be paid

to the underwriters.

Common stock The firm’s common stock is currently selling for $50 per share.

The dividend expected to be paid at the end of the coming year (2016) is $4. Its

dividend payments, which have been approximately 60% of earnings per share in

each of the past 5 years, were as shown in the following table.

Year Dividend 2015 $3.75 2014 3.50 2013 3.30 2012 3.15 2011 2.85

It is expected that to attract buyers, new common stock must be underpriced

$5 per share, and the firm must also pay $3 per share in flotation costs. Dividend

payments are expected to continue at 60% of earnings. (Assume that rr = rs.)

a. Calculate the after-tax cost of debt.

b. Calculate the cost of preferred stock.

c. Calculate the cost of common stock.

d. Calculate the WACC for Dillon Labs.

Your boss believes the company’s power plant is producing too much air pollution on a typical island. Your boss gives you three choices for dealing with this problem because he/she does not want to deal with it:

1. You can pay a pollution tax (Carbon Offsets) one time of $13,000,000 immediately.
2. You can close the plant and install a power cable from the mainland to the Island. That will cost you $1,000,000 at the end of this year, $3,000,000 at the end of next year and then $750,000 forever for maintenance.
3. You can retrofit the plant with scrubbers to reduce the emissions to make the plant green. That will cost $7.5m at the end of this year and $100,000 for 50-years for maintenance.

Assume that the cost of generating power on the mainland is approximately the same as the cost of generating power at the Island’s plant. Assume, this comes as a surprise to you and you, have not saved any money in reserves, and you need to raise capital.  Additional information is that market has a 12 percent market risk premium on the power plant with the risk-free rate being 5 percent with a company tax rate of 35 percent.

Current total raised capital at the power plant:  (This will help you calculate the WACC)

• Debt –  7,000 outstanding bonds, at 7.5% coupon and 20 years to maturity. These bonds pay interest semiannually and quoted a price of 108 percent of par.
• Common Stock -180,000 shares outstanding, selling for $50 per share: Beta .90.
• Preferred Stock – 8,000 shares of 5.5 percent preferred stock outstanding, currently selling for $95.00 per share.

Please answer in essay format and provide your Excel document showing all your calculation in appendixes choose the best option for Island. Support your answer with your calculations. Also, to calculations use specified resources, other appropriate scholarly resources, including older articles.

Length: However long you need to answer the question (Paragraph per option is normal).

Your paper should demonstrate thoughtful consideration of the ideas and concepts presented in the course and provide new thoughts and insights relating directly to this topic. Your response should reflect scholarly writing and current APA standards. Be sure to adhere to University’s Academic Integrity Policy.

Upload your assignment using the Upload Assignment button below.

Grading Guideline –

• The introduction should state the answer and establish the topic and a clear thesis statement.
• The conclusion summarizes the main points and leaves the reader with a strong comprehension of the paper’s significance and the author’s understanding of the correct financial decision.
• All research is correctly credited, using correct APA format.
• Grammatically correct – No spelling, grammar, or mechanics errors.

Lesson 6

Business Communication

Question 1 of 40

2.5 Points

Which of the following would be the best to include in an executive summary?

A. Our program stimulates young minds while strengthening their bodies.
B. Childhood obesity is a growing epidemic.
C. Many people don’t realize just how important physical fitness is.
D. Current guidelines say that children should get at least 60 minutes of exercise each day.

Question 2 of 40

2.5 Points

Which of the following media is most appropriate if you want to encourage your audience to collaborate, interact, and create content?

A. slides
B. podcasts
C. flipcharts
D. video conferences

Question 3 of 40

2.5 Points

If a proposal is a few pages long, then which of the following components is most likely to help the reader see the structure of the document at a glance?

A. references
B. headings
C. appendices
D. footnotes

Question 4 of 40

2.5 Points

In the context of a proposal, which of the following terms refers to the items you are agreeing to provide to the audience?

A. references
B. appendices
C. advantages
D. deliverables

Question 5 of 40

2.5 Points

Jane is preparing a proposal for an audience that has invited her to do so. This means that __________.

A. it is an unsolicited proposal
B. Jane will need to explain her experience and qualifications
C. the direct organizational approach would be appropriate
D. Jane’s audience is not aware that a problem or opportunity exists

Question 6 of 40

2.5 Points

Amanda wants to make a demonstration during her presentation which involves sharing some content with her audience that is not available in electronic form. In this situation, which of the following would be the most appropriate medium to use?

A. podcasts
B. videos
C. props
D. flipcharts

Question 7 of 40

2.5 Points

Which of the following is considered part of analyzing your setting?

A. What do the key players care about?
B. What are the needs and interests of the audience?
C. How far do I need to move the audience before they act?
D. Will I be using my own computer to present slides?

Question 8 of 40

2.5 Points

Anne is trying to get a sense of the overall structure of her slide presentation. She sketches headlines and ideas for the body of the slides on some Post-It notes, rearranging them as necessary. Anne is creating a(n. __________ for her presentation.

A. storyboard
B. template
C. slide master
D. animation

Question 9 of 40

2.5 Points

Which of the following statements would be the best to use in a proposal?

A. Our equipment does the job in half the time it takes for our competitor’s equipment.
B. Our equipment did the job in half the time it took for our competitor’s equipment.
C. Our equipment had done the job in half the time it had taken for our competitor’s equipment.
D. Our equipment has done the job in half the time it has taken for our competitor’s equipment.

Question 10 of 40

2.5 Points

Dave is working on a succinct description of a database proposal, which encapsulates the opportunities for cost savings and increased functionality that the new system presents, as well as its other key ideas. He is struggling to create content that, while remaining brief, will enable his audience to understand the proposal’s main ideas without having to read the whole document. Dave is working on the proposal’s __________.

A. introduction
B. executive summary
C. body
D. references

Question 11 of 40

2.5 Points

Providing which of the following in your proposal will help build your credibility with the audience?

A. descriptions of similar projects you have completed
B. a list of the deliverables you are agreeing to provide
C. an explanation of when and how the work will be completed
D. a delineation of your costs

Question 12 of 40

2.5 Points

Which of the following statements is most likely to be true regarding a competitive proposal?

A. In a competitive proposal situation, your audience will not be considering any offers other than yours.
B. A competitive proposal is the one you initiate without receiving any requests from the audience.
C. While developing a competitive proposal, you will need to identify audience requirements as they will not be stated explicitly.
D. While developing a competitive proposal, you should consider the benefits you provide compared to your competition.

Question 13 of 40

2.5 Points

Conducting research to develop your proposal __________.

A. should not be considered during your analysis of content needs
B. is never necessary in order to propose realistic costs
C. must wait until the composing stage of the ACE process
D. could be necessary to learn more about competitors submitting competitive proposals

Question 14 of 40

2.5 Points

Understanding the need your proposal meets and how to meet that need is involved in the first step of preparing a proposal: defining its __________.

A. content
B. context
C. purpose
D. format

Question 15 of 40

2.5 Points

You are sending a proposal in response to an RFP from a local elementary school that is seeking a provider for an after-school enrichment program promoting physical fitness. Including which of the following in your summary would best demonstrate that you listen to your clients, understand what they are trying to accomplish, and have an appropriate solution?

A. Our instructors are top-notch and have much experience putting high school students on the road to better nutrition and physical fitness.
B. Our program focuses primarily on creative expression, which also has some physical fitness benefits.
C. The key to our program’s success is getting kids to exercise early in the day, which keeps them energized and focused for the rest of their day’s work.
D. Our program is designed for grades K-4 and has greatly improved fitness at the many schools where it is offered at the end of the day.

Question 16 of 40

2.5 Points

Which of the following tasks would require a proposal?

A. persuade your manager to approve your leave
B. persuade a retailer to repair damage not covered under your warranty
C. persuade your boss to approve a project
D. persuade a retailer to provide you a discount

Question 17 of 40

2.5 Points

Whiteboards are recommended when you want to __________.

A. encourage the audience to collaborate and create content
B. encourage the audience to listen and look carefully
C. communicate complex material that people need to look at carefully
D. present lengthy content that cannot easily be seen in slide form

Question 18 of 40

2.5 Points

The term __________ refers to the supplemental information provided in a proposal. It often includes examples of past projects, client testimonials, and technical specifications.

A. overview
B. references
C. executive summary
D. appendices

Question 19 of 40

2.5 Points

“The proposed developer employed only certified programmers. Over the past five years they have redesigned more than 50 databases for local businesses. They will add innovative new functionalities to our system, while increasing the efficiency of our current system’s capabilities.” Which of the following options best improves the section of Dave’s text excerpted above?

A. replacing “employed” in the first sentence with “used to employ”
B. replacing “employed” in the first sentence with “employs”
C. replacing “have redesigned” in the second sentence with “will redesign”
D. replacing “will add” in the third sentence with “can add”

Question 20 of 40

2.5 Points

Which of the following guidelines should be followed when creating a template that supports effective visual communication?

A. Use dramatic color gradations on backgrounds.
B. Use highly ornate dingbats as bullets.
C. Avoid including slide numbers.
D. Avoid templates with decorative, nonfunctional graphics.

Question 21 of 40

2.5 Points

If you want to represent the percentage of respondents in a survey who preferred your product to products from four of your competitors, the best graph to use would be a __________.

A. pie chart
B. line chart
C. histogram
D. scatter plot

Question 22 of 40

2.5 Points

__________ assess the success of a project or a decision.

A. Feasibility reports
B. Recommendation reports
C. Evaluation reports
D. Trip reports

Question 23 of 40

2.5 Points

Which of the following is NOT true of progress reports?

A. They are considered informational reports.
B. They update your status on a long-term project.
C. They indicate any potential problems or issues within a project.
D. They are a type of analytical report.

Question 24 of 40

2.5 Points

__________ arrange data in columns and rows, allowing you to read down or across to see different relationships.

A. Tables
B. Histograms
C. Line graphs
D. Bar charts
Question 25 of 40	2.5 Points

You are just back from Amsterdam where you had gone to attend a business conference. Your manager asks you to send him a report which documents your activities and indicates what you accomplished or learned during the conference. Your manager wants you to prepare a __________.

A. progress report
B. feasibility report
C. trip report
D. recommendation report

Question 26 of 40

2.5 Points

PowerPoint report decks __________.

A. are designed to be read as well as presented
B. cannot be printed out for participants at a meeting
C. require the presence of a presenter
D. contain slides that are less detailed than those in traditional presentations

Question 27 of 40

2.5 Points

John, a sales executive, has written a trip report about his recent trip to Germany where he met with some current and potential clients. Which of the following does NOT describe a communication purpose of this trip report?

A. planning resources for the potential new business
B. reviewing and evaluating follow-up plans for trip activities
C. serving as a checklist with which to measure progress on new business opportunities
D. analyzing whether new business plans can be implemented as proposed

Question 28 of 40

2.5 Points

Which of the following elements of a report contains information that would interrupt the flow of the report but that readers may find useful?

A. executive summary
B. table of contents
C. glossary
D. appendix

Question 29 of 40

2.5 Points

Bryan hasn’t created a report deck before, but thinks it would be an effective medium for his report. His science-based analytical report will need to include a number of diagrams and photographs, and he is expected to present it at a meeting. Which of the following is true?

A. This is a poor choice, since as a novice he will find report decks difficult to work with.
B. This is a poor choice, since it will be more costly and time-consuming than drafting two separate documents, one for the written report and one for the presentation.
C. This is a good choice, since it will allow him to easily integrate diagrams and photographs into his report.
D. This is a good choice, since most of his audience will see a presentation in this medium for the first time and will be impressed by his technical knowledge.

Question 30 of 40

2.5 Points

A new employee is given the responsibility of keeping the minutes for her work team’s meetings. What advice will you give her?

A. Devote most of the space in your minutes to summarize the discussion at the meeting.
B. Minutes should not be action-oriented because their main purpose is to record the flow of the discussion.
C. Record specific decisions resulting from the meeting.
D. A table is an ineffective format for recording meeting minutes.

Question 31 of 40

2.5 Points

Which of the following is recommended for effectively designing a slide deck?

A. Use background graphics for the slides.
B. Size your title box to accommodate only one-line headlines.
C. Leave space for “road signs” on the upper-left or upper-right corners of your slides.
D. Do not include a copyright marking in the slides.

Question 32 of 40

2.5 Points

The introduction to Anya’s report __________.

A. should include page numbers along with the headings
B. should be omitted since her report includes an executive summary
C. should be written as if the reader did not read the executive summary at all
D. should include a list of figures and tables along with their page numbers

Question 33 of 40

2.5 Points

If you were preparing a report for readers who are not native English speakers, which of the following would be best to include?

A. Signage installation is regulated, so we must obtain a permit.
B. We will need to get a permit before we can put up a sign.
C. Local regulations forbid the installation of signage without prior approval.
D. In order to mount our signs as planned, we will need to get authorization in advance.

Question 34 of 40

2.5 Points

Connor’s supervisor asks him to analyze whether their plan to start web-based retailing can be implemented as proposed. His supervisor is asking Connor for a(n. __________.

A. feasibility report
B. progress report
C. compliance report
D. investigation report

Question 35 of 40

2.5 Points

You are preparing a formal report. You want to include some raw data and large tables in your report that you think readers will find useful; however, if you include this information in the body of the report then it will interrupt the flow of the document. In such a situation, you should include this information in the __________ of the report.

A. executive summary
B. appendix
C. introduction
D. glossary

Question 36 of 40

2.5 Points

Evan is preparing a memo report recommending that his company should contract with a particular event planner for an upcoming corporate function. He includes all the pertinent information regarding costs, services provided, and why this choice would better serve the company’s needs. He also has some additional documentation which he’d like to add, including descriptions of prior events this agency has planned, photographs of venues, menus, etc. Evan should include this information __________.

A. in the body of the report
B. as attachments to the report
C. in the executive summary
D. as part of the reference list

Question 37 of 40

2.5 Points

A(n. __________ is a mini-version of a report designed to communicate its most important ideas to an audience of decision makers.

A. glossary
B. reference list
C. table of contents
D. executive summary

Question 38 of 40

2.5 Points

In formal reports and in report decks, additional information is included in a(n. __________.

A. glossary
B. reference list
C. executive summary
D. appendix

Question 39 of 40

2.5 Points

__________ are written reports of meetings.

A. Executive summaries
B. Minutes
C. Feasibility reports
D. Appendices

Question 40 of 40

2.5 Points

A paired bar chart is also known as a __________.

A. line chart
B. stacked column chart
C. histogram
D. tornado chart