1. Award: 2.00 points
Which one of the following statements is accurate for a levered firm?
0 WACC should be used as the required return for all proposed investments.
0 A firms WACC will decrease whenever the firm's tax rate decreases.
0 An increase in th
Award: 2.00 points
A sole proprietorship:
0 provides limited financial liability for its owner.
0 involves significant legal costs during the formation process.
0 has an unlimited life.
) O has its profits taxed as personal income.
0 can generally raise s
1.
Award: 2.00 points
The net present value:
decreases as the required rate of return increases.
is equal to the initial investment when the internal rate of return is equal to the required
return.
method of analysis cannot be applied to mutually exclusiv
1.
Award: 2.00 points
Net working capital increases when:
xed assets are purchased for cash.
inventory is purchased on credit.
inventory is sold at cost.
a credit customer pays for his or her purchase.
inventory is sold at a prot.
References
Multiple Choi
1.
Award: 2.00 points
Which one of the following statements is correct?
The risk-free rate of return has a risk premium of 1.0.
The reward for bearing risk is called the standard deviation.
Risks and expected return are inversely related.
The higher the e
1.
Award: 2.00 points
Which one of the following statements is true?
The current yield on a par value bond will exceed the bond's yield to maturity.
The yield to maturity on a premium bond exceeds the bond's coupon rate.
The current yield on a premium bon
1.
Award: 2.00 points
Which one of the following actions will increase the current ratio, all else constant? Assume the current
ratio is greater than 1.0.
Cash purchase of inventory
Cash payment on an account receivable
Cash payment of an account payable
Practice Exam I-Finance 301
1. Financial management decisions have three important questions that need to be
answered. Please provide the question that concerns with the following item:
a. Capital budgeting
b. Capital structure
c. Working capital manageme
Key Concepts and Skills
Know:
The difference between book value and market value
The difference between accounting income and cash flow
The difference between average and marginal tax rates
How to determine a firms cash flow from its financial statements
4-2
Chapter Outline
4.1
4.2
4.3
Future Value and Compounding
Present Value and Discounting
More on Present and Future Values
Solving for:
Implied interest rate
Number of periods
4-3
Basic Definitions
Present Value (PV)
The current value of future cash f
6-2
Chapter Outline
6.1
6.2
6.3
6.4
6.5
6.6
6.7
Bonds and Bond Valuation
More on Bond Features
Bond Ratings
Some Different Types of Bonds
Bond Markets
Inflation and Interest Rates
Determinants of Bond Yields
6-3
Bond Definitions
Bond
Debt contract
Inte
Chapter Outline
1.1
1.2
1.3
1.4
1.5
1.6
Finance: A Quick Look
Business Finance and The Financial Manager
Forms of Business Organization
The Goal of Financial Management
The Agency Problem and Control of the Corporation
Financial Markets and the Corporatio
Amanda Jacksons Log Book Finance 301
Week of January 9th - Introduction and Chapter 1
With this being the first week of Finance we began with an introduction of
the class and what finance is in the world today. I thought it was very interesting to
learn a
Award: 2.00 points
Precision Engineering invested $125,000 at 6 percent interest, compounded annually for 3 years. How
much interest on interest did the company earn over this period of time?
Interest on interest = $125,000 ><(1 + .O6)3- [$125,000 + ($125