金融学原理英文版.doc

CH71 A Current ratio=3.8 times DSO=41.1 days Inventory turnover ratio=5.5 times Fixed assets turnover ratio=4times Debt ratio=48.1% Net profit margin on sales=4.1% ROA=7.7% Note that we didnt use average amount for stock variables B Bad profitability: low ROA Total asset turnover is poor.(1.86 times, while industry average=9.9/4.6=2.15 times) Low inventory turnover ratio High DSO C Every ratio we calculated except Fixed asset turnover was worse in 2007.2 A Current ratio: 1.98 times DSO: 75.24 days Inventory turnover ratio: 5.6times Total assets turnover 1.7times Net profit margin: 1.7% ROA= 2.88% ROE 7.56% Debt ratio 61.9% B 1.7%*1.7=2.89% 1.2%*3=3.6% C Terrible DSO Net profit margin is good Poor ROA and ROE poor total assets turnover ratio D Unusual growth rate in 2007 will cause the financial ratios we calculated to be misleading. Because we didnt use average amount for stock variables.3 Total liabilities and equity=300000 Debt=0.5*300000=150000 Sales=450000 Receivables=45000 Cost of goods sold=337500 Inventories=67500 Payables=90000 Cash=27000 Fixed assets= 160500 Common stock525004 A Current ratio =2.73 times Debt ratio= 30% TIE= 11 times Inventory turnover= 4.15 DSO= 29.89 days Fixed assets turnover= 5.41 times Total assets turnover= 1.77 times Profit margin on sales= 3.40% ROA= 6% ROE= 8.57% B 6% = 3.4% * 1.77 9% = 3% * 3 C The balance sheet is where the problem is. D Very low inventory turnover probably means an excess inventory stock. E Some ratios will be distorted. Use average to avoid the distortion.5 A Quick ratio =0.85 times Current ratio=2.33 times Inventory turnover ratio=4 times DSO= 37days Fixed assets turnover 10 times Total assets turnover= 2.37 ROA= 5.9% ROE=13.07% Debt ratio=54.8% Net profit margin on sales=2.5% P/E=5 times All of its ratios are worse than the industry averages B Current ratio decreases Inventory turnover increases Total assets turnover increases ROA & ROE increase If dividend doesnt increase or increases by an amount less than the increment of net income, increased retained earnings will cause a lower debt ratio. Higher net income will probably lead to higher stock price and higher P/E ratio.CH81 A Net income: 12.6 Dividends: 5.04 Addition to retained earnings: 7.56 Cash: 4.2 Receivables: 31.2 Inventories: 69.6 Current assets: 105 Net fixed assets: 42 Total assets: 147 Accounts payables: 10.8 Notes payable: 18 Accruals: 10.2 Current liabilities: 39 Long-term bonds: 6 Common stock: 15 Retained earnings: 73.56 Total liabilities and equity: 133.56 147-133.56=13.44 So “notes payable” should be 18+13.44=31.44, if financing feedback effects are not considered. B Current ratio:2 Debt ratio: 39.76% ROE: 14.23% C Addition to retained earnings: 35.28 Current ratio: 4.25 Debt ratio: 20.9% ROE: 10.84%3 A DOL=2.5 DFL=3 DTL=7.5 B Really easy to solve. C Reduce DOL or DFL, or both5 A 8000 watches: EBIT=-60000 180000 watches: EBIT=40000 B Qbe=14000 Sbe=350000 C 8000: -1.33 18000: 4.5 D Qbe=8750 E Qbe=175006 A 5000 unit: EBIT=-50000 12000 unit: EBIT=125000 B Qbe=70009 Sales: 2000 NI in 2008: 100 Addition to retained earnings =40CH91FV=561.82 PV=373.633 PV=500 PV=867.124 n=10.24 n=4.195 A 6374.97 B 1105.13 C 7012.46 1160.386 A 2457.83 B 865.90 C 2703.61 909.197 A 1251.24 1300.33 B 1600 16008 A 7% B 7% C 9% D 9000=2684.8*(1-(1+k)(-5)/k9 A 881.17 B 895.42 C 903.06 D 908.3510 500/(1+12%/n)(5*n) A 279.20 B 276.84 C 275.2211 A 5272.34 B 5374.0712 A EAR of second city bank=6.66%7%13 Payment each year: 6594.94 Year 1 interest: 2500 repayment of principal: 4094.94 remainder of principal: 20905.06 Year 2 interest: 2090.51 repayment of principal: 4504.43 remainder of principal: 16400.63 B Payment =13189.87 C 8137.2714 A Security Z: 9% Security B: 500=74.5*(1-(1+k)(-10)/k) B 558.39 548.33 C The value of Z remains 1000 But the value of B should be 981.97 Actual return of Z: 9% B: k=6.98% D 15 61204.05552 B 11019.96058 C 6840.86428416 A 176791.86 B 150258.8817 Hint: difference between the PV of these two loans. 10827.33-8926.48=1900.8518 This problem is kind of complicated. But the procedure is pretty straightfoward. Payment=4970.84CH103 A D1=2.1 D2=2.21 D3=2.32 B 5.29 C 24.72 D 30.01 E 30 F No Please pay attention to the expected stock price in the end of the 3rd year, 34.73. D4=2*(1.05)4 D4/(12%-5%)=34.734 A g=7% (中文版打错了，应该是1.1449) B Expected dividend yield 5% C 12%5 A 9.5 13.33 21 44 B Nonsense C no6 A 7.2 B 41.6 C 35.287 A 1000 B 812.59 711.89 C Capital gains yield: 18.74% 28.81% D Current yield: 5% E -13.74% -23.81% G 8 A 2.01 2.31 2.66 3.06 3.52 B Use the method on pp 294, ch edition P=39.42 C When p0=p0, then required rate of return=expected rate of return=dividend yield + capital gains yield So for 2007, dividend yield=2.01/39.42=5.1%, capital gains yield =12% - 5.1%=6.9% For 2011 dividend yield=D6/P5=3.7/52.8=7%, while capital gains yield=12%-7%=5%, which is also the growth rate of dividends after the fifth year. E Stock price will drop. F Stock price goes down. The capital gains yield equals “g” after 5 years, while dividend yield = 14% - g9 A PV=54.11 Expected dividend yield: 3.55% P1=57.6 Capital gains yield: 6.45% Note that 3.55%+6.45%=10%, which is just the required rate of return, k. B Stock value rises The total return will remain the same. The distribution between dividend yield and capital gains yield will be diffierent. C Capital gains yield=6% Dividend yield=4%10 A P0=21.43 B P0=26.47 C P0=32.14 D P0=40.54CH111 A Expected return=500000 B Tell me which one you would choose. C Risk averter D (1) 75000 (2) 15% (3) Whats your choice? (4) Whats your choice? (5) Of course the correlation mat