Finance Answers

Investment Strategies - Stocks and Bonds

Continue to design your own portfolio strategy. This assignment will be put into your personal finance journal.

1. Review your investing horizon, risk tolerance, and needs.
2. Rank the long-term and short-term investment strategies in order of their appropriateness for you.
3. Research and select two different stocks and two different bonds you believe would fit into your own personal investing goals.
4. Explain why you selected the stocks and bonds and why they are the best fit for your financial investment goals.
5. In your personal finance journal, record your ideas about the effects of your horizon, risk profile, and personal circumstances on your decisions about investing in stocks and bonds.

Context Links:

https://saylordotorg.github.io/text_personal-finance/s19-owning-stocks.html

https://saylordotorg.github.io/text_personal-finance/s20-owning-bonds.html

Extra Directions: Respond to this assignment with the mindset of a sixteen-year-old female in her sophomore year in high school.

Investor Choices

Please read the chapter and learn about options to invest in stock and bonds. Please develop a list of pros and cons for each item and share your list with the other students.

Chapter Links:

https://saylordotorg.github.io/text_personal-finance/s19-owning-stocks.html

https://saylordotorg.github.io/text_personal-finance/s20-owning-bonds.html

Use the compound interest calculator to answer the questions. Here are a few things to do when using the calculator:

Calculator Link: https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator

The Initial Investment will be the same as the Monthly Contribution.

Set the Compound Frequency to Annually.

Round all monetary answers to the nearest whole dollar.

Raul is a saver. He sets aside $100 per month during his career of 40 years to prepare for retirement. He does not like the idea of investing because he prefers to minimize his risk as much as possible, so he puts his money in a savings account which earns 1.5% interest per year.

What is the total balance in the account after 40 years?

How much of the total did Raul contribute himself?

How much money did Raul make through compound interest in this savings account?

Identify one way Raul could have increased the total amount of money he made over the 40 years. Explain your reasoning.

name the two drivers of the market share of Islamic banking assets and elaborate on their effects and their driving role in the economic growth.

You would like to increase the debt-equity ratio of the firm you are working but are concerned that the firm's shareholders may not be willing to accept additional financial leverage. What is your recommendation? 

A corporate bond shows a trading price of $124.65; a coupon rate of 6.245; a maturity date of February 15, 2034; and a par value of $1,000. What will you pay, and what will the yield be?

Cash budget: Basic Farmers Delight Corporation reported sales of $350,000 in June,

$380,000 in July, and $390,000 in August. The forecasts for September, October, and

November are $385,000, $418,000, and $429,000, respectively. The initial cash bal-

ance on September 1 is $150,000, and a minimum of $8,000 should be kept. Use the

given information to compile a cash budget for the months of September, October,

and November.

(1) Farmers Delight predicts that 5% of its sales will never be collected, 30% of its sales will be cash sales, and the remaining 65% will be collected in the following month.

(2) Farmers Delight receives other monthly income of $3,000.

(3) The actual or expected purchases are $150,000, $120,000, and $115,000 for the months of September to November, respectively, and 50% are paid in cash while the remainder is paid in the following month. The purchases for August

were $120,000.

(4) Monthly rent is $3,500 chargeable only in October and November.

What is the Marshall-Lerner condition for a stable foreign exchange market? For an unstable market? For a depreciation to leave a nation’s Balance of Payment unchanged?

Given that 𝐶 = 100 + 0.8𝑌; 𝑀 = 150 + 0.2𝑌; 𝐼 = 100 𝑎𝑛𝑑 𝑋 = 350,

a) Determine the equilibrium income

b) Show the results on two graphs with

(i) Injections and leakages on the vertical axis

(ii) Net injections and net domestic leakages on the vertical axis

c) Determine the new equilibrium and show on graph when there is;

i.An increase in X and I of 200

ii.A decrease in M of 100

iii.A decrease in S and M of 100