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Unformatted text preview: 2. Reinvestment rate vs. Interest rate risk what each are and how maturity of the bond effects each Chapter 8 1. Major characteristics of preferred stock 2. Major characteristics of common stock Chapter 14 1. What is the preference of investors for dividends vs. capital gains? What do they value most? 2. What are the most important factors a firm has to consider when making the dividend decision? Chapter 10 1. What is a firms WACC? What does the number represent? 2. What is meant by saying that WACC is the link between the assets and the liability and equity side of the balance sheet? 3. Why is the cost in common equity the most difficult to measure? Chapter 13 1. What is the trade off between in a firms capital structure decision? 2. What is the benefit of using debt? 3. What is the cost of using debt? 4. What is leverage (operating and financial) and what causes?...
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- Spring '08