The company which has high short-term financing needs. Introduction: Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Question

Want to see more full solutions like this?

Answer 1

Question

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Students have asked these similar questions

Consider the data below for six furniture companies. 2 A Variance- covariance matrix B D E F G H La-Z-Boy Kimball Flexsteel Leggett Miller Shaw Means 3 La-Z-Boy 0.1152 0.0398 0.1792 0.0492 0.0568 0.0989 29.24% 4 Kimball 0.0398 5 Flexsteel 0.1792 6 Leggett 0.0492 0.0649 0.0447 0.0447 0.3334 0.0062 0.0775 0.0062 0.0349 0.0269 20.68% 0.0775 0.0886 0.1487 25.02% 0.1033 0.0191 0.0597 31.64% 7 Miller 8 Shaw 0.0568 0.0349 0.0989 0.0269 0.1487 0.0886 0.0191 0.0594 0.0243 15.34% 0.0597 0.0243 0.1653 43.87% a. Given this matrix, and assuming that the risk-free rate is 0%, calculate the efficient portfolio of these six firms. b. Repeat, assuming that the risk-free rate is 10%. c. Use these two portfolios to generate an efficient frontier for the six furniture companies. Plot this frontier.

Noor HOME PROFILE « CENGAGE MINDTAP Homework - Chapter 9: Stock Valuation Assignment: Homework - Chapter 9: Stock Valuation Questions Problem 9.04 (Nonconstant Growth Valuation) Q Search th Assignment Score: 93 Save Submit Assignment for Grad Question 3 of Check My Work (1 remainin ORDERS 1. RENTALS 2. 3. eBook COURSES 4. 5. 6. Holt Enterprises recently paid a dividend, Do, of $2.75. It expects to have nonconstant growth of 14% for 2 years followed by a constant rate of 4% thereafter. The firm's required return is 8%. a. How far away is the horizon date? I. The terminal, or horizon, date is Year 0 since the value of a common stock is the present value of all future expected dividends at time zero. II. The terminal, or horizon, date is the date when the growth rate becomes nonconstant. This occurs at time zero. Study Tools 7. III. The terminal, or horizon, date is the date when the growth rate becomes constant. This occurs at the beginning of Year 2. IV. The terminal, or horizon, date…

2. These monthly expenses do not include car insurance ($215.00215.00 per month), health insurance ($280.00280.00 per month), or real estate taxes and insurance on their home ($33503350 per year), among other expenses. Find their total monthly outlay for all of these expenses. (Round to the nearest cent as needed. Do not include the $ symbol in your answer.) Part 7 Expenses Monthly Outlay Payments on debt from (a) $enter your response here Car insurance $ Health insurance $ Real estate taxes and insurance on home $ Total $

Answer 2

Question

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Answer 6

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Answer 7

Chapter 27, Problem 1P

Summary Introduction

To determine: The company which has high short-term financing needs.

Introduction:

Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Answer 8

Expert Solution & Answer

Explanation of Solution

Given information:

The given companies:

a) A clothing retailer,

b) A professional sports team,

c) An electric utility,

d) A company that operates toll roads,

e) A restaurant chain.

Explanation:

The companies which are not likely to have high short-term financing needs are as follows:

An electric utility is a company, which operates toll roads, and a restaurant do not have high short-term financing needs as they are not seasonal parties. These companies will have profits and losses throughout the period and not in a particular season.

Hence, options c), d), and e) companies do not have high short-term financing needs.

The companies which are likely to have high short-term financing needs are as follows:

A professional sports team and clothing retailer are likely to have high short-term financing needs. This is because these companies have seasonal markets and they need finance during the non-profitability period. Professional sports team needs finance to advertise, purchasing equipment, and sell tickets post-season.

A clothing retailer needs more finance to handle the negative cash flow shock. For example, if the retailer purchases unwanted stocks (that is, unrelated products), then the shortfall has to be borne by him; he will need more finance for the upcoming season.

Hence, options a) and b) are likely to have high short-term financing needs.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Ch. 27.1 - Prob. 1CC Ch. 27.1 - What is the effect of seasonalities on short-term...Ch. 27.2 - Prob. 1CC Ch. 27.2 - What is the difference between temporary and...Ch. 27.3 - Prob. 1CC Ch. 27.3 - Describe common loan stipulations and fees.Ch. 27.4 - What is commercial paper?Ch. 27.4 - How is interest paid on commercial paper?Ch. 27.5 - Prob. 1CC Ch. 27.5 - What is the difference between a floating lien and...

The company which has high short-term financing needs. Introduction: Many small-scale businesses need short-term financing rather than long-term financing; that is, for the period of one year. Seasonal businesses are most likely to have short-term financial needs for their kind of business.

Explanation of Solution

Want to see more full solutions like this?

Chapter 27 Solutions