What is the percentage increase in the market

Assignment Help Financial Management
Reference no: EM13808436

The market consists of the following stocks. Their prices and number of shares are as follows:

Stock    Price     Number of Shares Outstanding

A           $10                100,000

B            20                 10,000

C            30                200,000

D            40                 50,000

a. The price of Stock C doubles to $60, what is the percentage increase in the market if a S&P 500 type of measure of the market is used?

b. Repeat question (a) but use a Value Line type of measure of the market (i.e., a geometric average) to determine the percentage increase.

c. Suppose the price of stock B doubled instead of stock C. How would the market have fared using the aggregate measures employed in (a) and (b)? Why are your answers different?

Reference no: EM13808436

Questions Cloud

Changes in scope of an industry : Address the changes in scope of an industry (either an industry you are currently employed within or one that you would like to investigate and learn more about).
How has your initial perception of the client changed : How has your initial perception of the client changed
Explain the three factors that influence the cost of a query : Discuss the reasons for converting SQL queries into relational algebra queries before optimization is done.  Explain the three factors that influence the cost of a query
Sql queries will produce a correct response : Formulate SQL queries for (a) and (b) with reference to the database specified for homework 2. Ensure that your SQL queries will produce a correct response for every instance of the database. a. List the employeeid and salary of those supervisors who..
What is the percentage increase in the market : The market consists of the following stocks. Their prices and number of shares are as follows: The price of Stock C doubles to $60, what is the percentage increase in the market if a S&P 500 type of measure of the market is used? Repeat question (a) ..
Explain the role and importance of an sm within a company : Explain the role and importance of an SM within a company - Analyze the approach of your selected three companies toward sustainable management.
Firm multifactor productivity before and after changes : What is the firm's multifactor productivity before and after the changes? Why is it important to be aware of the productivity changes?
Applications of goldratt theory of constraints : Read about key elements and applications of Goldratt's theory of constraints. Post, with explanation, at least 3 elements that you found most important and applicable to the company.
Initiating client services : Assume that you are the owner of an import business that specializes in the sale of floor tiles from around the world. Your business has grown dramatically over the 2 years since its founding, and you are looking for a way to convert your accounts re..

Reviews

Write a Review

 

Financial Management Questions & Answers

  What is the present value of that annuity if discount rate

You are considering preferred stock that pays a quarterly dividend of $1.50. If your desired return is 3% per quarter, how much would you be willing to pay? An investment will provide you with $100 at the end of each year for the next 10 years. What ..

  Expected return and standard deviation of a portfolio

Suppose that a fund that tracks the S&P has mean E(RM) = 16% and standard deviation ?M = 10%, and suppose that the T-bill rate Rf = 8%. What is the expected return and standard deviation of a portfolio that has 50% of its wealth in the risk-free asse..

  Total annual holding and ordering costs associated

Eastside Auto purchases a component used in the manufacture of automobile generators directly from the supplier. West side’s generator production operation, which is operated at a constant rate, will require 1000 components per month throughout the y..

  Find the value today of a perpetual annuity

Find the value today of a perpetual annuity that pays $1.75 per quarter starting on the last day of quarter 15 (the end of the third quarter of the 4th year) assuming an interest rate of 6% a year, compounded quarterly.

  From a philosophical and theoretical point of view do you

contd from the question - as well as situations that involved public figures from various genres caught performing

  How would you calculate their net worth

Fatimah and Ahmad, both 30 years old, own a house worth $120,000 and have a yearly income of $50,000, monetary assets of $15,000, two cars worth $30,000, and furniture worth $10,000. The house has a $100,000 mortgage, they have college loans of $15,0..

  Capitated environment versus fee-for-service environment

What are the critical differences in prot analysis when conducted in a capitated environment versus a fee-for-service environment? What cost structure is best when a provider is capitated? Explain.

  Compute the payback statistic

Compute the payback statistic for Project B and decide whether the firm should accept or reject the project with the cash flows shown below if the appropriate cost of capital is 12 percent and the maximum allowable payback is three years.

  Purchasing bonds with warrants instead of straight bonds

Pierre Imports recently issued two types of bonds. The first issue consisted of 10-year straight debt with a 9 percent annual coupon. Calculate the implied value of the warrants attached to each bond. Discuss 3 advantages to the investor of purchasin..

  What is the present value of this annuity stream

Your company just signed a 20-year lease for a new office. The lease requires that your firm pay $1,000 at the end of each month over the life of the lease. If the current annual rate is 9 percent, what is the present value of this annuity stream?

  What is their nominal yield to call

A firm's bonds have a maturity of 10 years with a $1,000 face value, have an 11% semiannual coupon, are callable in 5 years at $1,186, and currently sell at a price of $1,332.41. What is their nominal yield to maturity? What is their nominal yield to..

  What is the capital gains yield

The Toy Chest pays an annual dividend of $4.80 per share and sells for $93.20 a share based on a market rate of return of 15 percent. What is the capital gains yield?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd