Financial issues and lottery
Financial issues
Description
. 1. You have just won the Strayer Lottery jackpot of $11,000,000. You will be paid in 26 equal annual installments beginning immediately. If you had the money now, you could invest it in an account with a quoted annual interest rate of 9% with monthly compounding of interest. What is the present value of the payments you will receive?
2. In your own words and using various bond websites, please locate one of each of the following bond ratings: MA, BBB, CCC, and D. Please describe the differences between the bond ratings. Identify the strengths and weaknesses of each rating.
'Risk and Retum' Please respond to the following: 3. Determine whether stock prices are affected more by long-term or short-term performance. Provide one (1) example of the effect that supports your claim. 4. Value a share of Trevose Fitness Center's stock using a growth model method and compare that value to the current trading price of a share of Trevose Fitness Center. Determine whether the stock is undervalued or overvalued. Provide a rationale for your response.
"Financial Options and Weighted Average Cost of Capital onfAccy respond to the following: 5. Determine two to three (2-3) methods of using stocks and options to create a risk-free hedge portfolio. Support your answer with examples of these methods being used to create a risk-free hedge portfolio. 6. Create a unique hypothetical weighted average cost of capital (WACC) and rate of retum. Recommend whether or not the company should expand, and defend your position.