Consider three bonds with 6.4% coupon rates, all making annual coupon payments and all selling at a face value of $1,000. the short-term bond has a maturity of 4 years, the intermediate-term bond has maturity 8 years, and the long-term bond has maturity 30 years. a. what will be the price of each bond if their yields increase to 7.4%? (do not round intermediate calculations. round your answers to 2 decimal places.) 4 years 8 years 30 years bond price $ $ $ b. what will be the price of each bond if their yields decrease to 5.4%? (do not round intermediate calculations. round your answers to 2 decimal places.) 4 years 8 years 30 years bond price $ $ $ c. are long-term bonds more or less affected than short-term bonds by a rise in interest rates? more affected less affected d. would you expect long-term bonds to be more or less affected by a fall in interest rates? more affected less affected

What is the most important type of decision that the financial manager makes?

You are the manager in charge of global operations at bankglobal – a large commercial bank that operates in a number of countries around the world. you must decide whether or not to launch a new advertising campaign in the u.s. market. your accounting department has provided the accompanying statement, which summarizes the financial impact of the advertising campaign on u.s. operations. in addition, you recently received a call from a colleague in charge of foreign operations, and she indicated that her unit would lose $8 million if the u.s. advertising campaign were launched. your goal is to maximize bankglobal’s value. should you launch the new campaign? explain. pre-advertising campaign post-advertising campaign total revenues $18,610,900 $31,980,200 variable cost tv airtime 5,750,350 8,610,400 ad development labor 1,960,580 3,102,450 total variable costs 7,710,930 11,712,850 direct fixed cost depreciation – computer equipment 1,500,000 1,500,000 total direct fixed cost 1,500,000 1,500,000 indirect fixed cost managerial salaries 8,458,100 8,458,100 office supplies 2,003,500 2,003,500 total indirect fixed cost $10,461,600 $10,461,600

An outside manufacturer has offered to produce 60,000 daks and ship them directly to andretti's customers. if andretti company accepts this offer, the facilities that it uses to produce daks would be idle; however, fixed manufacturing overhead costs would be reduced by 75%. because the outside manufacturer would pay for all shipping costs, the variable selling expenses would be only two-thirds of their present amount. what is andretti's avoidable cost per unit that it should compare to the price quoted by the outside manufacturer?