Reference no: EM1350112
14. You own a portfolio that consists of $8,000 in stock A, $4,600 in stock B, $13,000 in stock C, and $5,500 in stock D. What is the portfolio weight of stock A?
A. 14.79 percent
B. 15.91 percent
C. 18.42 percent
D. 19.07 percent
E. 25.72 percent
10. Assume a project has earnings before depreciation, and taxes of $110,000, depreciation of $40,000, and that the firm has a 30 percent tax bracket. What are the after-tax cash flows for the project?
A. $47,000
B. $89,000
C. a loss of $21,000
D. none of these
11. Which of the following statements is true regarding systematic risk?
A. is diversifiable
B. is the total risk associated with surprise events
C. it is not project or firm specific
D. it is measured by standard deviation
12. Which statement is true regarding risk?
A. the expected return is usually the same as the actual return
B. a key to assess risk is determining how much risk an investment adds to a portfolio
C. risks can always be decreased or mitigated by the financial manager
D. the higher the risk, the lower the return investors require for the investment