Question 1
In 2009, an agricultural company introduced a new cropping process which
reduced the cost of growing some of its crops. If sales in 2008 and 2009 were
steady at $30 million, but the gross margin increased from 2.8% to 3.9%
between those years,

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Displayed
Submitted Answers, Correct
Answers
Question 1
Which of the following statements regarding bonds and their terms is FALSE?
Selected
Answer:
Correct
Answer:
Unlike the case of bonds that pay coupons, for zero-coupon bonds,
there is no form

Question 1
A business promises to pay the investor of $6000 today for a payment
of $1500 in one year's time, $3000 in two years' time, and $3000 in three
years' time. What is the present value of this business opportunity if the
interest rate is 6% per ye

Question 1
Divisional costs of capital are more appropriate when evaluating a project for
a line of business when the types of business in a firm are _.
Selected
Answer:
Correct
Answer:
differe
nt
differe
nt
Question 2
When a firm is evaluating the purcha

Question 1
In case of normal swings in the risk-free rate, option prices are not very
sensitive to changes in the risk-free rate.
Selected
Answer:
e
Correct
Answer:
e
Fals
Tru
Question 2
Use the information for the question(s) below.
Luther is a successfu

Question 1
Martin is offered an investment where for $6000 today, he will
receive $6180 in one year. He decides to borrow $6000 from the bank to make
this investment. What is the maximum interest rate the bank needs to offer on
the loan if Martin is at le

Question 1
The price of Microsoft is $25 per share and that of Apple is $50 per share. The
price of Microsoft increases to $36 per share after one year and to $41 after
two years. Also, shares of Apple increase to $56 after one year and
to $66 after two y

Question 1
Which of the following statements is FALSE?
Selected
Answer:
Correct
Answer:
The geometric average return will always be above the arithmetic
average return, and the difference grows with the volatility of the
annual returns.
The geometric aver

Question 1
0 out of 1 points
Jumbuck Exploration has a current stock price of $3.00 and is expected to sell
for $3.15 in one year's time, immediately after it pays a dividend of $0.28.
Which of the following is closest to Jumbuck Exploration's equity cos

Question 1
The financial manager of a well-regarded book publishing firm wishes to buy a
small Internet publishing company to provide an avenue for sale of its
materials online. In order to raise the funds to make this purchase, the
financial manager deci

Question 1
You expect KT industries (KTI) will have earnings per share of $5 this year and
expect that they will pay out $1.25 of these earnings to shareholders in the
form of a dividend. KTI's return on new investments is 13% and their equity
cost of cap

Question 1
A tenant wants to lease a building for $50,000 per year. She signs a five-year
rental agreement that states that she will pay $25,000 every six months for the
next five years. Which of the following is the timeline for her rental payments,
assu

Chapter 1
Question 1
Financial decisions require that you weigh alternatives in strictly monetary terms.
Selected
Answer:
e
Correct
Answer:
e
Fals
Fals
Question 2
Valiant Corp. is a C corporation that earned $3.4 per share before it paid any taxes.
Valian

Chapter 2
Question 1
Company A has current assets of $42 billion and current liabilities of $41 billion.
Company B has current assets of $2.7 billion and current liabilities of $1.8 billion.
Which of the following statements is correct, based on this info

COUNTRY PROFILE: GERMANY
Country Profile: Germany
Kari Smith
Eastern New Mexico University
June 20, 2016
Abstract:
COUNTRY PROFILE: GERMANY
2 Kari Smith
DESCRIPTION OF COUNTRY
History of origin
o Political Background In the year 800 AD, Emperor Charlemagn

Chapter 9
Question 1
A bond has a face value of $15,000 and a conversion ratio of 220. The stock is currently
trading at $39.20. What is the conversion price?
Selected
Answer:
Correct
Answer:
Response
Feedback:
$68.
18
$68.
18
$15,000 / 220 = $
68.18
Ques

Chapter 13
Question 1
Anheuser Busch, a manufacturer of beverages, is planning to purchase Six Flags theme
parks. Anheuser Busch should use the _ to evaluate the business of Six Flags.
Selected
Answer:
WACC of Six
Flags
Correct
Answer:
WACC of Six
Flags
Q

Chapter 5
Question 1
Suppose the term structure of interest rates is shown below:
Term
Rate
(EAR%)
1 year
2 years
3 years
5 years
5.00%
4.80%
4.60%
4.50%
10 years 20 years
4.25%
4.15%
The net present value (NPV) of an investment that costs $4320 and pays

Chapter 8
Question 1
Which of the following situations can lead to IRR giving a different decision than NPV?
Selected
Answer:
Correct
Answer:
All of the above can lead to IRR giving a different decision
than NPV.
All of the above can lead to IRR giving a

Chapter 11
Question 1
The Ishares Bond Index fund (TLT) has a mean and annual standard deviation of returns
of 5% and 10%, respectively. What is the 66% confidence interval for the returns on
TLT?
Selected
Answer:
-5%, 15
%
Correct
Answer:
-5%, 15
%
Quest

Chapter 6
Question 1
Which of the following best illustrates why a bond is a type of loan?
Selected
Answer:
Correct
Answer:
When an investor buys a bond from an issuer, the investor is giving money
to the issuer, with the assurance that it will be repaid

Chapter 3
Question 1
Consider the following timeline:
If the current market rate of interest is 7%, then the value as of year 1 is closest to
_.
Selected
Answer:
Correct
Answer:
$6
8
$6
8
Question 2
Cronus Airlines has a contract that gives them the oppor

Chapter 7
Question 1
Rylan Industries is expected to pay a dividend of $5.70 year for the next four years. If
the current price of Rylan stock is $31.27, and Rylan's equity cost of capital is 12%,
what price would you expect Rylan's stock to sell for at t

Chapter 4
Question 1
Consider the following timeline detailing a stream of cash flows:
If the current market rate of interest is 8%, then the present value (PV) of this stream of
cash flows is closest to _.
Selected
Answer:
Correct
Answer:
$48
4
$48
4
Que

Chapter 12
Question 1
A portfolio has three stocks 150 shares of Yahoo (YHOO), 220 Shares of General
Motors (GM), and 60 shares of Standard and Poor's Index Fund (SPY). If the price of
YHOO is $20, the price of GM is $20, and the price of SPY is $130, cal