BFIN 300 Final Exam Questions With
Solutions
When the expected future cash flows of an investment project increase, the net present value of
the project: increases
A PE is based on: historical earnings
The time value of money concept can be defined as: the relationship between a dollar to
...
When the expected future cash flows of an investment project increase, the net present value of
the project: increases
A PE is based on: historical earnings
The time value of money concept can be defined as: the relationship between a dollar to
be received in the future and a dollar today
Ratios that measure how efficiently a firm's management manages its current assets and current
liability accounts are known as _____ ratios. liquidity
Cash Flow to stockholders must be positive when: the dividends paid exceed the net new
equity raised
The ________ breaks down return on equity into three component parts: Du Point Identity
To convince investors to accept greater volatility, you must: increase the risk premium
, BFIN 300 Final Exam Questions With
Solutions
If a firm produces a twelve percent return on assets and a fifteen percent return on equity, then
the firm has a equity multiplier greater than 1.0
Incremental cash flows include any cost that: will change if a project is undertaken
The default risk premium is the: compensation investors demand for accepting credit risk
Using a payback period of three years for projects is: an arbitrary decision by
management
The cash flow tax savings generated as a result of a firm's tax-deductible depreciation expense is
called the: depreciation tax shield
One of the reasons why cash flow analysis is popular is because: it is difficult to
manipulate, or spin the cash flows.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller UpperClass. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for £10.56. You're not tied to anything after your purchase.
