The interest rate typically will be the highest

Assignment Help Financial Management

Reference no: EM132067065

1. If a firm is projected to increase revenues by 10% AND net income by the same amount, which of the following must be true?

A- there can be no variable costs

B- there can be no fixed costs

C- there can be no taxes

2. The interest rate typically will be the highest on which of the following

Limited liability bond

General obligation bond

Revenue bond

Corporate bond

3. You are the Chief Financial Officer of a large electric utility company, and are about to recommend to your Board of Directors that an expensive new wind electric generating plant is approved for construction. The Board represents the company's shareholders: As such, any decisions they make must be done in the shareholders' best interest.

What part of your assessment gives you confidence that this project will benefit the company’s shareholders in future periods?

a. The Net Present Value (“NPV”) of the project was below zero.

b. The Internal Rate of Return (“IRR”) of the project was greater than the targeted ‘hurdle’ rate of return.

c. The project has expected future cash flows that are extremely difficult to forecast with any accuracy.

d. The salvage value of the equipment required for the project at the end of its useful life is anticipated to be just 5% of its original cost.

e. All of the above.

Reference no: EM132067065

Questions Cloud

What is the carrying value of the bonds : The straight-line method of amortization is to be used. After seven years, what is the carrying value of the bonds

Due to increased mailing costs : Due to increased mailing costs, the new rate will cost publishers $62 million. How much did it cost publishers last year?

Find what is the cost of new common equity : Barton Industries expects next year's annual dividend, D1, to be $2.20 and it expects dividends to grow at a constant rate g = 4.9%. The firm's current common.

Rated values of primary and secondary line-to-line voltages : Determine the rated values of primary and secondary line-to-line voltages, the rated primary and secondary line currents, the ratio of line-to-line voltages

The interest rate typically will be the highest : The interest rate typically will be the highest on which of the following

Calculate the rate of return of equity and debt instruments : The purpose of this assignment is to allow the student an opportunity to calculate the rate of return of equity and debt instruments.

What is the risk-free rate if the risk premium on the stock : What is the risk-free rate if the risk premium on the stock is 8.60 percent?

Calculate line and phase values of voltages and currents : Calculate line and phase values of voltages and currents in each part of the circuit, and the turns ratio of each transformer.

What is the maximum tax credit these parents can take : Tom is a freshman at the University where his tuition is $4,000. What is the maximum tax credit these parents can take

User Account

All Pages