Which Of The Following Statements Is False
1.Which of the following statements is FALSE?A.If XYZ Corp’s $1,000 8% bond with 10 years to maturity is selling at $960, the yield is less than 8%.B.Prices of longer maturity bonds are more sensitive to interest rate changes.C.Simple interest is charged on bank bills while compound interest is applied on bonds.D.A bond with a coupon rate of 10% and yield of 12% will sell at a discount.2.AA Co. has just paid a dividend of $0.52. Next year’s dividend is expected to be 15% higher, after which the dividend will remain the same indefinitely. Assuming shareholders require a rate of return of 20%, what is the price of the stock today?A.$11.96B.$2.60C.$2.99D.$10.403.Which of the following statements is FALSE?A.The perpetuity formula gives the present value of an infinite stream of dividends is valued at the same point in time as the first dividend.B.If all earnings are paid out as dividends, DPR is 1.C.The usefulness of a vaulation multiple will depend on the nature of the differences between firms and the sensitivity of the multiples to these differences.D.(V0)/(EBITDA1) is an Enterprise Value Multiple.4.Growing Real Fast Company (GRF) is expected to have a 25 percent growth rate for the next four years (affecting D1, D2, D3, and D4). Beginning in year five, the growth rate is expected to drop to 1.2 percent per year and last indefinitely. If GRF just paid a $4.00 dividend and the appropriate discount rate is 18.5 percent, then what is the value of a share of GRF? Enter your answer to two decimal places.5.Calculate the price of a 5-year $100,000 8% government bond that pays interest semi-annually, if the required market yield is 6% p.a. compounding semi-annually.A.$105,428.20B.$98,542.90C.$103,586.85D.$108,530.20
Which Of The Following Statements Is False
1. (TCO 5) Which of the following statements is false?No one is going to make you save the money, you need to start a program.To be useful, investment objectives must be very specific.Investment goals can be different for each individual.Because investment objectives deal with the future, it is useful to plan more than 5 years in the future.A long-term investment objective involves a time period of 2 years or less.Question 2. 2. (TCO 5) Eric Peltz earns $70,000 a year. His monthly expenses total $3,600. What is the minimum amount of money that Mr. Peltz should set aside in an emergency fund?$1,800$3,600$10,800$21,600$35,000Question 3. 3. (TCO 5) You currently hold a $1,000 corporate bond, however, if interest rates in the overall economy increase, which of the following is most likely to be the market value of this bond?$900$1,100$1,000The value of the bond will not change.It is impossible to determine whether the bond’s value will increase or decrease.Question 4. 4. (TCO 5) Which of the following individuals should have the highest tolerance for risk?Joan Cummings, who is a single mother with two small childrenDarren Carter, who works for American Airlines and is worried that he is going to be laid off soonBarry Parks, who is an investment banker and earns over $200,000 per yearMichael Clark, who is 74 years old and been retired for 6 yearsFred Funderbunk, who delivers pizzas and makes about $15,000 per yearQuestion 5. 5. (TCO 5) Mary Ann recently received a $20,000 gift from her uncle and is considering investing in stocks, because she knows that historically they have earned an approximately 10–12% rate of return over the last few years. Referring to aspects of investing, Mary Ann is most concerned about which of the following?RiskReturnDiversificationLiquidityIncomeQuestion 6. 6. (TCO 5) A $1,000 corporate bond pays 6.5% a year. What is the annual interest you will receive?$0.65$6.50$65.00$1,060.50$1,065.00Question 7. 7. (TCO 5) Investments can be affected by all of the following risks exceptinflation.global risks.individual selection.business failure.market risks.Question 8. 8. (TCO 5) Tracey Hernandez is 26 and has saved enough money for an emergency fund, along with an additional $4,500 for an investment program. She is single with no dependents and has a desire to retire at 65. What would best characterize Ms. Hernandez’s investment goal?BetaIncomeGrowthRiskLiquidityQuestion 9. 9. (TCO 5) Matt Dannon just bought the stock of a company that provides him with the responsibility to approve major company actions. Which one of the following best characterizes this responsibility?Voting rightsProxyEquityDividendsNone of the aboveQuestion 10. 10. (TCO 5) If Orlando Blodgett is buying the stock of the Getaway Caribbean Cruise Company. If he buys the stock today, knowing it is the first day it is selling without the dividend for this quarter, on what date is Orlando buying the stock?Record dateSale datePayment dateEx dividend dateNone of the aboveQuestion 11. 11. (TCO 5) Bill Affleck is interested in buying preferred stock, but to be protected if the company needs to omit a dividend payment. He wants any unpaid dividends to accumulate and be paid before any common stock dividends are paid. Which one of these features of preferred stock is Bill seeking?CallableCumulativeCredibleNone of the aboveQuestion 12. 12. (TCO 5) Common stock represents _____.a loan to a companycorporate ownershipa loan to an investora guarantee of dividendsa cash distributionQuestion 13. 13. (TCO 5) One option for long-term corporate financing is equity financing, and this is a popular choice becausea lender is always available to provide this type of financing.it does not cost anything to sell in the primary market.repayment doesn’t have to be made for 10 years or more.only interest must be paid for the first 5 years.it does not have to be repaid.Question 14. 14. (TCO 5) Which of the following statements is false?Stockholders elect the board of directors.Stockholders pay taxes on dividends.Intelligent investors must be concerned about future after-tax profits.Dividend payments may not be reduced or omitted at any time.Corporate dividends may not always be paid in cash.Question 15. 15. (TCO 5) What is the approximate market value for a $1,000 corporate bond that pays 7% interest when comparable bonds are paying 8% interest?$800$875$70$1,142$1,000Question 16. 16. (TCO 5) The _____ is the financially independent firm or individual that acts as the bondholders’ representative.trusteepresident of the corporationdebenture holderindenture holderchairman of the boardQuestion 17. 17. (TCO 5) A _____ bond is unsecured and gives bondholders a claim secondary to that of other designated bondholders with respect to both income and assets.subordinated debenturemortgagedebenturepreemptiveTreasuryQuestion 18. 18. (TCO 5) A _____ is a bond typically secured by assets.debenture bondcorporate bondmortgage bondpreemptive bondTreasury bondQuestion 19. 19. (TCO 5) A(n) _____ fund is a fund to which annual or semiannual deposits are made for the purpose of redeeming a bond issue.serialindenturedebenturesinkingmoneyQuestion 20. 20. (TCO 5) A _____ bond is registered in the owner’s name by the issuing company.certifiedcoupongeneral obligationzero-couponregistered
Which Of The Following Statements Is False
Which of the following statements is false?A.M1, M2, and M3 include demand deposits and other checkable deposits.B.Term repurchase agreements are included in M3, but not in M1 and M2.C.U.S. savings bonds are included in M3, but not in M1 and M2.D.Travelers’ checks are included in M1, M2, and M3.2. Because of the financial crisis that began in 2008, by the end of 2009:A.unemployment was in excess of 10 percentB.many homeowners owed more money on their mortgage loans than the their homes were worthC.home mortgage foreclosure rates and personal and business bankruptcies were increasingD.over 100 banks in the U.S. had already failed with over 500 more being considered financially weakE.all of the above are true3. If the interest rate is greater than 0%, then a dollar today is worthA.more than a dollar tomorrowB.the same as a dollar tomorrowC.less than a dollar tomorrowD.there is not sufficient information to tell4. If the nominal interest rate is 8% and the risk-free rate is 3%, the expected inflation rate must be:A.3%B.5%C.11%D.cannot be determined without additional information5. Jill Clinton puts $1,000 in a savings passbook that pays 4% compounded quarterly. How much will she have in her account after five years?A.$1,200.50B.$1,220.20C.$1,174.80D.$1,217.506. is a short-term unsecured promissory note issued by a high credit–quality corporation with maturities of one to three months in length with an active secondary money.A.A negotiable certificate of deposit (NCD)B.A repurchase agreementC.Commercial paperD.Government bondE.none of the above7. Which of the following is not an asset of depository institutions?A.cashB.unsecured loansC.time depositsD.U.S. government securities8. ___________________ provide the record-keeping mechanism for showing ownership of the financial instruments used in the flow of financial funds between savers and borrowers and record revenues, expenses, and profitability of organizations that produce and exchange goods and services.A.Financial ManagersB.AccountantsC.Operations ManagersD.StatisticiansE.none of the above9. Define the term annuity due10. Identify the objectives of the national economic policy.11. Which of the following institutions is not part of the modern banking system?A.credit unionsB.savings and loan associationsC.mutual fundsD.mutual savings banks12. In response to the financial crisis of 2007-2009, the yield spread between Aaa corporate bonds and treasury bonds:A.widenedB.narrowedC.remained the sameD.none of the above13. An increase in inflation should:A.increase the demand for loanable fundsB.decrease the interest rate on loansC.increase the interest rate on loansD.none of the above14. If you expect the inflation premium to be 2%, the default risk premium to be 1% and the real interest rate to be 4%, what interest would you expect to observe in the marketplace on short term treasury securities?A.8%B.7%C.6%D.5%15. If the stated or nominal interest rate is 10 percent and the inflation rate is 5 percent, the net or differential compounding rate would be ________ percentA.tenB.fiveC.twoD.fifteen16. Automatic stabilizers include all of the following except:A.unemployment insuranceB.social securityC.welfareD.pay-as-you-go tax system17. You need to have $35,000 on hand to buy a new Lexus five years from today. To achieve that goal, you want to know how much you must invest today in a certificate of deposit guaranteed to return you 3% per year. To help determine how much to investment today, you will use:A.present value factorsB.annuity value factorsC.present value factors of an annuityD.future value factors of an annuity18. An organization that sells or markets new securities issued by businesses to individuals and institutional investors is called a (n)A.mutual fundB.investment bankC.insurance companyD.brokerage firm19. Gross Private Domestic Investment (GPDI) measures fixed investment in:A.residential and non-residential structuresB.individual expenditures for nondurable goodsC.individual expenditures for servicesD.none of the above20. Which of the following statements is most correct?A.Capital markets include short-term and long-term debt securities such as Treasury bills, notes, and bonds.B.Money market instruments include commercial paper, federal funds, repurchase agreements, and Treasury notes.C.Real estate mortgages are money market instruments.D.Federal agencies, and state and local governments, generally issue longer-term financial claims which trade in the capital market.I NEED COMPLETED BY 01/02/2016. THANK YOU.
Which of the following statements is FALSE
5) Which of the following statements is FALSE?
A) It is possible that an IRR does not exist for an investment opportunity.
B) If the payback period is less than a pre-specified length of time you accept the project.
C) The internal rate of return (IRR) investment rule is based upon the notion that if the return on other alternatives is greater than the return on the investment opportunity you should undertake the investment opportunity.
D) It is possible that there is no discount rate that will set the NPV equal to zero.