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FINC-3470-E1-Corporate Finance
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The hypothesis that market prices reflect all historical price information and all available public information is called _____ form efficiency.
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The weights placed on each source of financing when computing the WACC should be based on the:
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Taber Inc. is considering a project that will result in initial after-tax cash savings of $2.1 million at the end of the first year, and the savings will grow at a rate of 2% per year indefinitely. The firm has a target debt-equity ratio of 0.80, a cost of equity of 11%, and an after-tax cost of debt of 4.6%. The cost-savings proposal is somewhat riskier than the usual project the firm undertakes; management uses the subjective approach and applies an adjustment factor of +2% to the cost of capital for such risky projects. If the total initial cost to implement this cost-savings proposal is $23 million, what is the net present value (NPV)?
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Which of the following is most likely true about the WACC?
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You purchased 500 shares of a stock at a price of $22.50 per share. One year later, the shares sold for $21 each. At that end of the year, a $1.50 per share dividend was also paid. What is the dividend yield for the investment?
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The designated source(s) of external financing required to make the pro forma balance sheet balance is called:
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Moore Money Inc. has a profit margin of 11% and a retention ratio of 80%. Last year the firm had sales revenue of $500,000 and total assets of $1 million. The desired total debt-to-asset ratio is 75%. What is the firm’s sustainable growth rate?
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Based on the following information you have collected, what is the return on equity (ROE) for Leslie’s Dancing Studio? _Profit Margin 7.1%__ Capital Intensity Ratio 0.75__ Debt/Equity Ratio 0.60__ Net Income $48,000__ Dividends $13,000_
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Over the period of 1957-2017, which of the following investments has been the least risky?
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According to _________, the value of the firm is independent of its capital structure.
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