# BUS 5440 - FIT - FINANCIAL MGMT - FINAL EXAM MC PROBLEMS.docx

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the basis of the IRR will not cause any value to be lost because the project with the higher IRR will also  have the higher NPV, i.e., no conflict will exist.   WACC: 10.00% Year 0 1 2 3 4 CF S -\$1,025 \$650 \$450 \$250 \$50 CF L -\$1,025 \$100 \$300 \$500 \$700 << HIDE ANSWERS A \$5.47 B
\$6.02 C \$6.62 D \$7.29 E \$7.82 QUESTION: 4 [QUESTION BANK ID: 269615] CORRECT Benge Automotive issued a corporate bond with a face value of \$1,000, with a 10% annual coupon rate  paid semiannually. The bond matures in 12 years and sells at a price of \$1,080. What is the component  cost of debt for use in the WACC calculation?   A TYPE: MULTIPLE CHOICE << HIDE ANSWERS
QUESTION: 5 [QUESTION BANK ID: 269620] CORRECT Mansi Inc. is considering a project that has the following cash flow data. What is the project's payback?   Year 0 1 2 3 Cash flows -\$750 \$300 \$325 \$350 A TYPE: MULTIPLE CHOICE << HIDE ANSWERS
QUESTION: 6 [QUESTION BANK ID: 269628] CORRECT As a member of UA Corporation’s financial staff, you must estimate the Year 1 cash flow for a proposed  project with the following data. What is the Year 1 cash flow?   TYPE: MULTIPLE CHOICE
Depreciation \$10,000 Other operating costs \$17,000 Interest expense \$4,000 Tax rate 35.0% << HIDE ANSWERS A \$16,351 \$17,212 \$18,118 \$19,071 \$20,075 B C D E