Remember to submit your work following the file naming convention FirstInitial.LastName_M01.docx. For example, J.Smith_M01.docx. Remember that it is not necessary to manually type in the file extensio

Remember to submit your work following the file naming convention FirstInitial.LastName_M01.docx. For example, J.Smith_M01.docx. Remember that it is not necessary to manually type in the file extension; it will automatically append.

Start by reading and following these instructions:

1. Quickly skim the questions or assignment below and the assignment rubric to help you focus.
2. Read the required chapter(s) of the textbook and any additional recommended resources. Some answers may require you to do additional research on the Internet or in other reference sources. Choose your sources carefully.
3. Consider the discussion and the any insights you gained from it.
4. Create your Assignment submission and be sure to cite your sources, use APA style as required, check your spelling.
5. LENGTH: 1000 - 1250 words

Assignment:

1. As pointed out at the beginning of this chapter, it doesn't make sense to establish an investment program until credit card and installment purchases are reduced or eliminated. While most people are responsible and make payments when they're supposed to, some people get in trouble. To help avoid this problem, each of the following organizations has a home page on the Internet: Consumer Credit Counseling Service provides information about how to manage consumer debt (https://credit.org/cccs/). Green Path Debt Solutions provides counseling for people with debt problems. (http://www.greenpath.com/). Choose one of the above organizations and visit its home page. Then prepare a report that summarizes the information provided by the organization. Finally, indicate if this information could help you manage your consumer debt.
2. From the investment alternatives described in this chapter, choose two specific investments you believe would help an individual who is 35 years old, is divorced, and earns $27,000 a year begin an investment program. Assume this person has $30,000 to invest at this time. As part of your recommendation, compare each of your investment suggestions on safety, risk, income, growth, and liquidity.
3. Assume you are single and have graduated from college. Your monthly take-home pay is $2,500, and your monthly expenses total $2,300, leaving you with a monthly surplus of $200. Develop a personal plan of action for investing using the steps listed in Exhibit 13-5 of your text.
4. Assume you have established an emergency fund and have saved an additional $12,000 to fund an investment in common stock issued by AT&T Corporation. Using the sources of information discussed in this chapter, go to the library or use the Internet to obtain information about this company. Summarize your findings describing AT&T's current operations and the firm's past and present financial performance. Finally, indicate whether you would purchase AT&T common stock based on the information in your report.
5. Prepare a two-minute oral presentation that describes why corporations sell bonds. Record the presentation and submit the video to your instructor.
6. Using the Internet. Use the information at the bond site on Yahoo! Finance lo answer the following questions about a corporate bond. To complete this activity, follow these steps.

Exercises:

1. James Hayes owns 370 shares of Ohio Utility preferred stock. If this preferred stock issue pays $2.80 per share, what is the total dollar amount Mr. Hayes will receive in one year?
2. Marie and Bob Houmas purchased 200 shares of General Electric stock for $23 a share. One year later, they sold the stock for $31 a share. They paid their broker a $32 commission when they purchased the stock and a $41 commission when they sold it. During the 12 months they owned the stock, they received $152 in dividends. Calculate the total return on this investment.
3. Carl Patterson likes investing in stocks that pay dividends. Carl owns 25 shares of a local utility company. The stock pays a regular annual dividend in the amount of $3 per share and the company has indicated that the dividend will stay the same for a long time. If Carl reinvests his dividends each year and the dividends earn a return of 6 percent each year, how much will Carl accumulate in 15 years?
4. After researching Best Buy common stock, Sally Jackson is convinced the stock is overpriced. She contacts her account executive and arranges to sell short 200 shares of Best Buy. At the time of the sale, a share of common stock had a value of $27. Three months later, Best Buy is selling for $18 a share, and Sally instructs her broker to cover her short transaction. Total commissions to buy and sell the stock were $74. What is her profit for this short transaction?
5. Jackson Metals, Inc., issued a $1,000 convertible corporate bond. Each bond is convertible to 40 shares of the firm's common stock. a. What price must the common stock reach before investors would consider converting their bond to common stock? b. If you owned a bond in Jackson Metals, would you convert your bond to common stock if the stock's price did reach the conversion price? Explain your answer.
6. Mark Crane purchased a $1,000 corporate bond five years ago for $1,060. The bond pays 4.5 percent annual interest. Five years later, he sold the bond for $950. Calculate the total return for Mr. Crane's bond investment.
7. Assume you are in the 39.6 percent tax bracket and purchase a 3.35 percent, tax-exempt municipal bond. Use the formula presented in this chapter to calculate the taxable equivalent yield for this investment.
8. Assume you purchased a high-yield corporate bond at its current market price of $850 on January 2, 2004. It pays 9 percent interest and will mature on December 31, 2013, at which time the corporation will pay you the face value of $1,000. a. Determine the current yield on your bond investment at the time of purchase. b. Determine the yield to maturity on your bond investment.