(a) To Discuss: The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio. Introduction: A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond. Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond. The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Question

Duncan Company is a large manufacturer and distributor of cake supplies. It is based in United Kingdon (Headquarters) It sends supplies to firms throughout the United States and the Caribbean . It markets its supplies through periodic mass mailings of catalogues to those firms. Its clients can make orders over the phone and Duncan ships the supplies upon demand.The main competition for Duncan’s comes from one U.S. firm and one Canadian firm. Another British firm has a small share of the U.S. market but is at a disadvantage because of its distance. The British firm’s marketing and transportation costs in the U.S. marketare relatively high.a) Duncan Company plans to penetrate either the Canadian market or two other Caribbean Countries (Jamaica and Haiti). What factors deserve to be considered in deciding which market is more feasible? I NEED PROPER REFERENCES IN THE ANSWER AND A VERY DETAILED AND RESEARCH ANSWER.

Answer 1

Question

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

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Duncan Company is a large manufacturer and distributor of cake supplies. It is based in United Kingdon (Headquarters) It sends supplies to firms throughout the United States and the Caribbean . It markets its supplies through periodic mass mailings of catalogues to those firms. Its clients can make orders over the phone and Duncan ships the supplies upon demand.The main competition for Duncan’s comes from one U.S. firm and one Canadian firm. Another British firm has a small share of the U.S. market but is at a disadvantage because of its distance. The British firm’s marketing and transportation costs in the U.S. marketare relatively high.a) Duncan Company plans to penetrate either the Canadian market or two other Caribbean Countries (Jamaica and Haiti). What factors deserve to be considered in deciding which market is more feasible? I NEED PROPER REFERENCES IN THE ANSWER AND A VERY DETAILED AND RESEARCH ANSWER.

Please help follow these guidelines pertaining to market audit amd competitive market analysis. With the super market name PUEBLO in St. Thomas U S Virgin Islands.

A company currently pays a dividend of $3.6 per share (D0 = $3.6). It is estimated that the company's dividend will grow at a rate of 19% per year for the next 2 years, and then at a constant rate of 6% thereafter. The company's stock has a beta of 1.4, the risk-free rate is 8.5%, and the market risk premium is 4.5%. What is your estimate of the stock's current price? Do not round intermediate calculations. Round your answer to the nearest cent.

Answer 2

Question

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

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Answer 3

Question

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

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Answer 4

Question

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

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Answer 5

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

Answer 6

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Answer 7

Chapter 10, Problem 3PS

Summary Introduction

(a)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's times-interest-earned ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

The times-interest-earned-ratio is the calculation of a firm's income before interest and taxes divided by the interest expense.

Answer 8

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Answer 9

Summary Introduction

(b)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's debt-equity ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Debt-equity ratio is the calculation of the extent to which the shareholders equity can meet the obligations of the creditors in the event of a decline.

Answer 10

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

Answer 11

Summary Introduction

(c)

To Discuss:

The likely effect on a bond's yield to maturity of an increase in the issuing firm's quick ratio.

Introduction:

A bond is a security that creates an obligation on the issuer to make specified payments to the holder for a given period of time. The face value of the bond is the amount the holder will receive on maturity along with the coupon rate which is also known as the interest rate of the bond.

Yield to maturity is defined as the discount rate that makes the present payments from the bond equal to its price. In simple terms, it is the average rate of return a holder can expect from that bond.

Quick ratio is the measure of a company's ability to pay its short term obligations using its most liquid assets.

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Ch. 10 - Prob. 1PS Ch. 10 - Prob. 2PS Ch. 10 - Prob. 3PS Ch. 10 - Prob. 4PS Ch. 10 - Prob. 5PS Ch. 10 - Prob. 6PS Ch. 10 - Prob. 7PS Ch. 10 - Prob. 8PS Ch. 10 - Prob. 9PS Ch. 10 - Prob. 10PS

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