If you put $10,000 in an investment that returns 11 percent compounded monthly what would you have after 10 years (rounded to nearest $1)? A) $27,559 B) $29,892 C) $22,489 D) $25,486 ANSWER B
Date: September 19th, 2020
For the FCFF calculation it is important to include the total net working capital of the firm. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Perpetuities last “forever” but annuities have a finite life. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Marble Corp. has a beta of 2.5 and a standard deviation of returns of 20%. The return on the market portfolio is 15% and the risk-free rate is 4%. According to CAPM, what is the required rate of return on Collectible’s stock? A) 26.5% B) 37.5% C) 23.5% D) 31.5% ANSWER D
Date: September 19th, 2020
The major DISADVANTAGE of the Free Cash Flow to the Firm method (and DCF methods in general) is that it is based on sound time value of money principles, Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
In a “qualified tax-deferred” retirement plan, taxes are deferred on A) employer contributions and interest earned by the retirement fund. B) only employer contributions. C) only interest earned by the retirement fund. D) only employee contributions. ANSWER A
Date: September 19th, 2020
The time value of money implies that one dollar today is worth more than one dollar tomorrow, due primarily to the opportunity cost of foregoing consumption today Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
What is the future value of $500 invested at 8.94% compounded quarterly for 12.5 years (rounded to nearest $1)? A) $46,739 B) $1,510 C) $670 D) $1,617 ANSWER B
Date: September 19th, 2020
Under the current law, lenders must meet quotas in extending credit to women and minorities. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
When comparing a firm to its peers, why is it difficult to determine the industry to which the firm belongs? Why should you be careful when comparing a firm with industry norms? What will be an ideal response? ANSWER 1. It is sometimes difficult to determine the industry to which a firm belongs […]
Date: September 19th, 2020
