“Like its peers in Denmark, the euro area, Sweden and Switzerland, the Bank of Japan will charge commercial banks for holding deposits with it. Almost a quarter of the world’s GDP now comes from countries with negative rates. Though they defy convent..
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Financial institutions that rely on REPOs are forced to go back to the market regularly to roll over maturing paper. This is a risk to the firm since fear of lenders can create a severe liquidity crisis for the borrowing firm.
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Most corporations pay quarterly dividends on their common stock rather than annual dividends. Barring any unusual circumstances during the year, the board raises, lowers, or maintains the current dividend once a year and then pays this dividend out i..
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Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 8 years because the firm needs to plow back its earnings to fuel growth. The company will pay a $13 per share dividend in 9 years and will inc..
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Your firm is expanding and you need $18 million to help fund this growth. You estimate that you can sell new shares of stock for $30 a share. You also estimate that it will cost you $330,000 for legal, accounting, and other costs related to the stock..
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Which of the following is the main cost of the operation of commercial banks? a.) cost of labor b.) interest the banks pay on their borrowings c.) cost of materials d.) cost of energy
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Double Circle, Inc. just signed a five-year loan agreement to purchase a piece of property. If the property cost was $160,000, what would be the size of each equal semi-annual payments to amortize the loan at an interest rate of 10%? How much interes..
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United Kingdom allows an asset's book value to be increased to its estimated market value. Why do you think a company's management would want to write up the value of its assets? What impact would such a write-up have on the balance sheet and the inc..
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Dr. D, a dentist, performed a root canal for a patient and charged him $300. The patient paid $100, then left town, never to be seen again. What is the amount of bad debt deduction, if any, that D may claim assuming that she is a cash basis taxpayer?
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Trigen Corp. management will invest cash flows of $1,238,006, $1,143,422, $1,487,955, $818,400, $1,239,644, and $1,617,848 in research and development over the next six years. If the appropriate interest rate is 8.12 percent, what is the future value..
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Kingston Equipment is considering a project that will require the purchase of $1,480,000 in new equipment. The equipment will be depreciated straight-line to a zero book value over the 7-year life of the project. What is the amount of the aftertax sa..
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You want to buy a car, and a local bank will lend you $30,000. The loan will be fully amortized over 5 years (60 months), and the nominal interest rate will be 11% with interest paid monthly. What will be the monthly loan payment? What will be the l..
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