What is the IRR of the F-22 Raptor project? The Lockheed Martin/Boeing F-22 Raptor is a stealth fighter aircraft. It was designed primarily as an air superiority fighter, but it is also capable of ground attack and other roles. Lockheed Martin Aeronautics is the prime contractor and is responsible for the majority of the airframe, […]
The future value of a $500 annuity due received for three years is $________, assuming an investment rate of 10%. A) 1,655.00 B) 665.50 C) 1,820.50 D) 335.65 ANSWER C
Xtra-Terrestrial Landscapes needs to raise capital to finance an expansion in their business. The company is trying to decide between borrowing or issuing more equity. Selected financial information is provided in the table below. The current capital structure is shown in the column labeled “Current.” Under Option E, they will sell 600 new shares at […]
Which component of a firm’s capital structure is the most difficult to estimate? A) Preferred stock B) Equity C) Bank loans D) Bond-financed debt E) Private placements of debt ANSWER B
Some adjustable rate mortgages contain payment caps that limit monthly mortgage payments. Indicate whether the statement is true or false ANSWER TRUE
Married couples filing a joint return may take two standard deductions. Indicate whether the statement is true or false ANSWER FALSE
What economic field of study explores the problems associated with a firm that arise from a separation of ownership and control and devises ways to resolve them? A) futures and options B) agency theory C) foreign direct investment D) franchising ANSWER Answer: B
Consider two firms that are identical in every way except that one has $15,000 of debt and 500 shares of stock outstanding, while the other is all-equity and has 650 shares of stock outstanding. Assume that the debt is a perpetuity with annual coupons at the rate of 6%. What is each firms’ earnings per […]
If you wish to double your money in 6 years, you must earn an interest rate of about A) 8%. B) 24%. C) 12%. D) 36%. ANSWER C
What are some of the basic beliefs of the anti-globalists? What will be an ideal response? ANSWER Answer: The anti-globalist movement targets multinational corporations as one of the main villains of the globalization phenomenon that they believe is detrimental to the poor countries, their workers, and to disadvantaged people in developed countries. Laissez-faire […]
