Economics Answers

Sweatshirt Inc’s ROE is 20%. It’s dividend payout ratio is 70%. The last dividend, just
paid, was RM2.00. If its dividends are expected to grow at the company's internal
growth rate indefinitely, what is the current value of the company's common stock if
its required return is 18%?

Sweatshirt Inc’s ROE is 20%. It’s dividend payout ratio is 70%. The last dividend, just
paid, was RM2.00. If its dividends are expected to grow at the company's internal
growth rate indefinitely, what is the current value of the company's common stock if
its required return is 18%?

In 2000 Jengka Inc. issued bonds with an 8 percent coupon rate and a RM1,000 face
value. The bonds will mature on March 1, 2025. If an investor purchased one of
these bonds on March 1, 2012, determine the yield to maturity if the investor paid
RM1,100 for the bond.

Power of Tower Inc. has bonds that mature in 6½ years with a par value of RM1,000.
They pay a coupon rate of 9% with semiannual payments. If the required rate of
return on these bonds is 11% what is the bond's current value?

Buttercup Inc. just issued RM1,000 par 30-year bonds. Each bond was sold for
RM1,107.20 and pay interest semiannually. Investors require a rate of 7.75% on the
bonds. What is the bonds' coupon rate?

You have been accepted to study international economics at the International
Banking College (IBC) in Kuala Lumpur. You will need RM10,500 every 6 months
(beginning today) for the next three years to cover tuition and living expenses. Mom
and Dad have agreed to pay for your education, and want to make one deposit today
in a bank account earning 6% interest, compounded semiannually. How much must
they deposit now so that you can withdraw RM10,500 at the beginning of each
semester over the next 3 years?

The rate of economic growth per capita in France from 1996 to 2000 was 1.9% per year, while in Korea over the same period it was 4.2%. Per capita real GDP was $28,900 in France in 2003, and $12,700 in Korea. Assume the growth rates for each country remain the same.
Compute the doubling time for France’s per capita real GDP.
Compute the doubling time for Korea’s per capita real GDP.
What will France’s per capita real GDP be in 2045?
What will Korea’s per capita real GDP be in 2045?

Stella is an 8 year old that gets a monthly allowance of $10 from her parents. There are only two things that Stella likes to spend her allowance on: chocolate bars and packages of stickers. Assume that initially chocolate bars cost $1 each and packages of stickers cost $2 each.
(a) Define the number of chocolate bars and packages of stickers Stella consumes as Qc and Qs respectively. Write down the equation that expresses the budget line facing Stella. Represent Stella’s budget line graphically with chocolate bars on the vertical axis and packages of stickers on the horizontal axis. Using an indifference curve, illustrate Stella’s choice if her utility maximizing consumption is 2 chocolate bars and 4 packages of stickers. [5-marks]
(b) Imagine that Stella has spent her allowance and made the optimal choice of consuming 2 chocolate bars and 4 packages of stickers. Suppose that we are given the information that Stella’s marginal utility from consuming more chocolate at this point is equal to 5. What is her mar

Under a perfect competition the price as sh. 6 per unit has been determined. An individual firm has a total cost function given by C=10+15Q - 5Q^2+Q^3/3. Find the revenue function and the quantity produced at which profit will be maximum profit

If you put RM200 in a savings account at the beginning of each year for 10 years and
then allow the account to compound for an additional 10 years, how much will be in
the account at the end of the 20th year? Assume that the account earns 10% and
round to the nearest RM100.