CFIN LATEST 2024 FORM A REAL EXAM QUESTIONS AND CORRECT ANSWERS (ALL CORRECT) A GRADE
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Module
CFIN
Institution
CFIN
CFIN LATEST 2024 FORM A REAL EXAM QUESTIONS AND CORRECT ANSWERS (ALL CORRECT) A GRADE
It does not recognize cash flows beyond the payback period - Answer-A shortcoming of the simple payback method is
Should be qualitatively considered before selection - Answer-If IRR is higher than the hurdle ...
CFIN LATEST 2024 FORM A REAL EXAM
QUESTIONS AND CORRECT ANSWERS
(ALL CORRECT) A GRADE
It does not recognize cash flows beyond the payback period - Answer-A shortcoming of
the simple payback method is
Should be qualitatively considered before selection - Answer-If IRR is higher than the
hurdle rate, the investment
False - Answer-T/F The payback method accounts for time value of money
B: added to net income - Answer-To determine cash flow, depreciation is
A: after tax cost - Answer-The cost of debt is equal to a firm's
False - Answer-T/F If market interest rates fall, the market will place a discount on
bonds which have coupon rates that are higher than the market interest rate
False - Answer-T/F The cost of debt is the coupon rate of the bonds used to finance the
debt
True - Answer-T/F For WACC purposes, to calculate the cost of debt you multiply the
interest rate by (1-tax rate)
C: the target's cost of equity - Answer-The appropriate discount rate to use in
discounting the cash flow of the target is
B: the target's cost of equity - Answer-Discounting the terminal value of the target
involves a discount rate that is
False - Answer-T/F Residual values tend to be the easiest to predict
A: depreciation of the assets - Answer-Which of the following items would have the
greatest impact on the book value of the firm?
False - Answer-T/F The market capitalization is obtained by multiplying the number of
shares by the earnings per share
B: minimum acceptable price - Answer-The target firm determines its liquidation value
and the PV of its relevant stand alone cash flows and selects the higher value. This is
the target's
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