Reference no: EM133119064
1.The DDM is most used by analyst because it has no flaws as a model
True
False
2.An increase in accounts receivable is always concerning.
True
False
3.Tourist would be happier traveling to a country after their home currency appreciated against the destination's currency
True
False
4.If a company has negative operating and investing cash flows, they must have a negative change in cash.
True
False
5.All countries should increase their currency value because this will encourage exports.
True
False
6.A country with high imports should want a strong currency
True
False
7.Zero coupon usually always trade at discounts.
True
False
8.Book Value is a superior valuation method for equities
True
False
9.The higher a company's payout ratio, the higher its growth
True
False
10.Preference share values are not subject to risk because they pay a fixed dividend for life.
True
False
11.Which of the following is not an activity ratio
Interest Coverage
Fixed Asset Turnover
Receivables Turnover
12.Gross margin is an example of a
Activity Ratio
Profitability Ratio
Efficiency Ratio
13.High inflation would cause a currency to
Appreciate
Depreciate
No effect
14.Strong economic growth will cause an
inflow of capital and currency depreciation
outflow of capital and currency appreciation
inflow of capital and currency appreciation
15.A central bank will sell reserves to cause its currency to
Appreciate
Depreciate
No effect
16.Which of the following leads to lower oil prices
A strong USD
Strong Economic Growth
A weak USD
17.Which of the following models will produce the closet value to market price
Net Asset Value
Dividend Discount Model
Relative Value
18.Increases in interest rates lead to
High Bond Yields and High Prices
Low Bond Yields and High Prices
High Bond Yields and Low Prices
Low Bond Yields and Low Prices
19.A bond with a coupon higher than the prevailing market rate will trade at a
discount
premium
par value
20.Which of the following would a Central Bank least use to affect interest rates?
Open market operations
Prime rate changes
Selling or buying reserves
21.If the current price of a security is higher than the intrinsic value, an investor should
Sell
Buy
Buy a call
22.Sentry Corp. bonds have an annual coupon payment of 7.25%. The bonds have a par value of $1,000, a current price of $1,125, and they will mature in 13 years. What is the Current market rate?
5.56%
5.85%
6.14%
6.45%
23.bonds that mature in 10 years were recently issued by Sternglass Inc. They have a par value of $1,000 and an annual coupon of 5.5%. If the current market interest rate is 7.0%, at what price should the bonds sell?
$829.21
$850.47
$872.28
$894.65
24.The Jameson Company just paid a dividend of $0.75 per share, and that dividend is expected to grow at a constant rate of 5.50% per year in the future. The company's beta is 1.15, the market return is 9.00%, and the risk-free rate is 4.00%. What is Jameson's current stock price, P0?
$18.62
$19.08
$19.56
$20.05