1. Phil's Carvings, Inc. wants to have a weighted average cost of capital of 9%. The firm
has an after-tax cost of debt of 5 %and a cost of equity of 11%. What debt-equity ratio is
needed for the firm to achieve its targeted weighted average cost of capit
Chapter 12 - An Alternative View of Risk and Return: The Arbitrage Pricing Theory
An Alternative View of Risk and Return: The Arbitrage Pricing Theory
Multiple Choice Questions
1. In the equation R =
+ U, the three symbols stand for:
You can turn in this homework any time before the final exam
1. Fuji Software, Inc., has the following
mutually exclusive projects.
a. Suppose Fuji's paybac
Business Finance, Spring 2007
Instructor: Nina Baranchuk
The hypothesis that market prices reflect all available information of every kind is
called _ form efficiency.
PROBLEM SET: Summarizing
Exercise 1. Present Value 
You are given the following prices Pt today for receiving risk free payments t periods from now.
1. Calculate the implied interest rates and graph the term structur
FIN 470 Exam 1
What are the three types of financial management decisions? For each type of decision, give an example
of a business transaction that would be relevant.
Capital budgeting (deciding whether to expand a manufacturing plant), capital
Next years annual dividend divided by the current stock price is called the:
yield to maturity.
capital gains yield.
The rate at which a stocks price is expected to appre
EQUITY MARKETS AND STOCK VALUATION
CHAPTER 7 QUIZ
Common Stock Valuation - FinSim
Stock valuation is more difficult than bond valuation because the cash flows are uncertain, the life is
forever, and the requir
Final Exam Spring 2005 FINC 6532 Your Name _
1. Which of the following appears to be the most appropriate goal for corporate management?
A. Maximizing market value of the company's shares.
2. The _ the time to maturity for a bond, the _ is its price chang