Craft Shack has a beginning cash balance for the quarter of $1,213. The store has a policy of maintaining a minimum cash balance of $1,000 and is willing to borrow funds as needed to maintain that balance. Currently, the firm has a loan balance of $410. How much will the store borrow or repay if the net cash flow for the quarter is −$260?

The common stock of Hall & Byrd is expected to lose 5 percent in a recession, earn 7 percent in a normal economy, and earn 9 percent in a booming economy. The probability of a boom is 15 percent while the probability of a recession is 22 percent. What is the expected rate of return on this stock?

The Metal Shop produces 1.7 million metal fasteners per year for industrial use. At this level of production, its total fixed costs are $486,000 and its total costs are $791,000. The firm can increase its production by 5 percent, without increasing either its total fixed costs or its variable costs per unit. A customer has made a one-time offer for an additional 50,000 units at a price per unit of $.165. Should the firm sell the additional units at the offered price? Why or why not?

You own a portfolio that has $1,720 invested in Stock A and $3,470 invested in Stock B. The expected returns on these stocks are 13.7 percent and 8.0 percent, respectively. What is the expected return on the portfolio?

Isaac has analyzed two mutually exclusive projects that have 3-year lives. Project A has an NPV of $81,406, a payback period of 2.48 years, and an AAR of 9.31 percent. Project B has an NPV of $82,909, a payback period of 2.57 years, and an AAR of 9.22 percent. The required return for Project A is 11.5 percent while it is 12 percent for Project B. Both projects have a required AAR of 9.25 percent. Isaac must make a recommendation and justify it in 15 words or less. What should his recommendation be?

Currently, Rangel Accessories sells 42,600 handbags annually at an average price of $149 each. It is considering adding a lower-priced line of handbags that sell for $79 each. The firm estimates it can sell 21,000 of the lower-priced handbags but expects to sell 7,200 fewer of the higher-priced handbags by doing so. What is the amount of annual sales that should be used when evaluating the addition of the lower-priced handbags?

Nidia Trophies has projected sales of $38,000, $47,500, $52,700, and $85,000 for Quarters 1 through 4 of next year, respectively. Inventory is purchased at 58 percent of the sales price and is purchased one quarter prior to the quarter of sale. The accounts payable period is 45 days. The accounts payable balance at the beginning of the year is $72,000. What is the amount of the expected disbursements for the third quarter?

An investment project provides cash flows of $7,000 per year for 10 years. If the initial cost is $20,000, what is the payback period?

The market risk premium equals the:

Altitude Ski has sales of $783,700, average accounts receivable of $56,700, and average accounts payable of $64,300. The cost of goods sold is equivalent to 42 percent of sales. How long does it take The Mountain Top Shoppe to pay its suppliers?