Question 1
1 out of 1 points
Benefit-cost ratio is calculated by:
Selected
Answer:
Answers:
d.
dividing the present value of future net cash flows by the initial
outlay.
a.
dividing the outlay by the present value of future net cash flows.
b.
dividing the
Question 1
1.5 out of 1.5 points
Given the data below, calculate the net present value of an infinite chain of
replacement using the equivalent annual value method. Assume the cost of capital
is 11% p.a.
Initial Outlay Year 1 Year 2 Year 3
-$10,000
$10,00
Question 1
0 out of 0 points
This online quiz is an individual assessment. Your answers should be your own work
and should not be the result of work done by others.
Selected
Answer:
I UNDERSTAND and AGREE that this is an individual assessment
and will sub
Question 1
0 out of 1 points
What is the beta of an asset with an expected return of 16%, if the risk-free rate of
interest is 6% and the expected market portfolio risk premium is 6%? Accurate to
two decimal places.
Selected Answer:
d.
0
Answers:
a.
2
b.
Question 1
0.5 out of 0.5 points
When using the CAPM to estimate the cost of equity for evaluation of investment
proposals, the appropriate substitute for the risk free rate of interest is:
Selected
Answer:
Answers:
c.
The yield on a government security w
EFN 406 quiz 9 Semester 2, 2016
Question 2
A Limited has just issued a bond with face value of $1000 and a coupon rate of 8%. If the
bond has a life of 15 years, pays annual coupons and the YTM is 7.5%, what will the bond
sell for?
$1044
$1020
$957
$1051
Finance Quiz 8
Sem 2, 2016
Question 1- The annual nominal rate is j m = 0.12pa. What is the effective annual rate
as a percentage to two decimal places? The number of compounding periods is 6.
Enter your answer as a decimal eg 17.42% = .1742 to four decim
Question 2
The difference between a nominal interest rate and an effective
interest rate is expected inflation.
Answer
True
False
Question 3
What is the Present Value of an amount of $4,000 to be received in
3 years if the rate is 13% p.a.? Your answer sh
EFN 406
Quiz 9
XYZ Corporation has just paid a dividend of 56 cents per share. The current
market price of the share is $15 and shareholders require a return of 10 % pa.
What is the annual growth rate (g) of the dividends? Answer as a percentage
accurate
Quiz 9
Polycorp has a debt equity ratio of 0.67. What is the correct debt ratio D/V that should be
used in the WACC formula?
WACC = ke x E/V + kd x (1-t) x D/V
Provide an answer as a decimal accurate to two decimal places eg 60.156% should be
entered as .
Question 1
0 out of 0.5 points
Using discounted payback. A conventional project that has a discount payback
period less than its useful life cannot have a negative NPV.
Selected Answer:
False
Answers:
True
False
Response Feedback: incorrect
Question 2
0.5
Question 1
0 out of 0 points
This online quiz is an individual assessment. Your answers
should be your own work and should not be the result of work
done by others.
Selected
Answer:
Answers:
I UNDERSTAND and AGREE that this is an
individual assessment an
Question 1
0.5 out of 0.5 points
In an efficient market the current price is:
Selected Answer:
c.
neither too low nor too high
Answers:
a.
none of the given answers
b.
always higher
c.
neither too low nor too high
d.
the prices do not change
e.
always low
Question 1
0.5 out of 0.5 points
The writer of an option is the:
Selected Answer:
e.
initial seller of the option
Answers:
a.
both buyer of the put option and buyer of the call option
b.
taker of a put option
c.
taker of a call option
d.
owner of the opti
Question 2
In an efficient market the purchase of financial assets would represent a zero NPV
project.
Answer
True (This is the correct answer)
False
Question 3 shares
A non-redeemable preference share is paying a constant dividend of $7. What is the curr