FINANCE Chapter 5 Test Banks Financial mgmt exam 1 Principles of Finance Chapter 3 ratios corporate finance exam 2 corporate finance exam 3 Questions And Answers
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Course
FINC - Finance
Institution
FINC - Finance
what would be the cost of a new common stock equity for tangshan mining if the
firm just paid a dividend of 4.25, the stock price is 55, dividends are expected
to grow at 8.5% indefinitely, and flotation costs are 6.25 per share.
~ 17.96
a firm has a beta of 1.2. the market return equals 14 ...
FINANCE Chapter 5 Test Banks
Financial mgmt exam 1
Principles of Finance Chapter
3 ratios corporate finance
exam 2 corporate finance
exam 3 Questions And
Answers
Since individuals are always confronted with opportunities to earn positive rates
of return on their funds, the timing of cash flows does not have any significant
economic consequences.(t or f)
✓~ FALSE
Time value of money is based on the belief that a dollar that will be received at
some future date is worth more than a dollar today.(t or f)
✓~ FALSE
,For a given positive interest rate, the future value of $100 increases with the
passage of time. Thus, the longer the period of time, the greater the future
value.(t or f)
✓~ TRUE
Future value is the value of a future amount at the present time, found by
applying compound interest over a specified period of time.(t or f)
✓~ FALSE
The greater the interest rate and the longer the period of time, the higher the
present value.(t or f)
✓~ F
Everything else being equal, the higher the interest rate, the higher the future
value.(t or f)
✓~ T
Future value increases with increases in the interest rate or the period of time
funds are left on deposit. (t or f)
, ✓~ T
Everything else being equal, the higher the discount rate, the higher the
present value. (t or f)
✓~ F
Everything else being equal, the longer the period of time, the lower the
present value (true or false)
✓~ T
________ is the amount earned on a deposit that has become the part of the
principal at the end of a specified time period.
A) Discount interest
B) Compound interest
C) Primary interest
D) Future value
✓~ B) Compound interest
, The future value of $100 received today and deposited at 6 percent for four
years is ________.
A) $126
B) $ 79
C) $124
D) $116
✓~ A) $126
The future value of $200 received today and deposited at 8 percent for three
years is ________.
A) $248
B) $252
C) $158
D) $200
✓~ B) $252
The present value of $100 to be received 10 years from today, assuming an
opportunity cost of 9 percent, is ________.
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