# 1) The stock of Trudeau Corporation went from \$27 to \$45 last year.

June 11, 2016

Question
1) The stock of Trudeau Corporation went from \$27 to \$45 last year. The firm also paid \$2 in dividends during the year. Compute the rate of return. 2) Given the following financial data, compute the return on assets and return on equity: net income/sales = 8%, sales/total assets = 2.5X, and debt/total assets = 15%. 3) What is the approximate yield to maturity of an 8% coupon bond with a par value of \$1,000? The bond is currently selling for \$920 and has 5 years to maturity. 4) A convertible bond has a face value of \$1,000 and the conversion price is \$60 per share. The stock is selling at \$25 per share. The bond pays \$85 per year in interest and is selling in the market for \$945. It matures in 7 years. Market rates are 10% annually. (I) What is the conversion ratio? (II) What is the conversion value? 5) If a \$100,000 Treasury bond futures contract changes by 15/32, what is the dollar change? 6) A mutual fund is set up to charge a load. Its net asset value is \$17.70 and its offer price is \$18.60. What is the dollar value of the load (commission)? 7) A shopping center has an annual net operating income of \$1,050,000 and a capitalization rate of 8%. What is its value? 8) An investment has the following range of outcomes and probabilities. Outcomes (Percent) Probabilities of Outcomes 5% .30 7% .25 12% .45 Calculate the expected value and the standard deviation (round to two places after the decimal point where necessary).