Thursday 8 September 2016

FIN 534 FINAL EXAM PART 1 & 2

FIN 534 FINAL EXAM PART 1 & 2

INAL EXAM PART 2



• Question 1
2 out of 2 points
Which of the following is NOT normally regarded as being a good reason to establish an ESOP?
Answer
Question 2
2 out of 2 points
Which of the following is NOT normally regarded as being a barrier to hostile takeovers?
Answer
Question 3
2 out of 2 points
If a firm adheres strictly to the residual dividend policy, the issuance of new common stock would suggest that
Answer
Question 4
2 out of 2 points
Which of the following statements is correct?
Answer
Question 5
2 out of 2 points
Which of the following statements is NOT correct?
Answer
Question 6
2 out of 2 points
Which of the following actions will best enable a company to raise additional equity capital?
Answer
Question 7
2 out of 2 points
Which of the following statements is correct?
Answer
Question 11
2 out of 2 points
Which of these items will not generally be affected by an increase in the debt ratio?
Answer
MORE QUESTIONS ENCLOSED A+ GRADED !!!!!

FINAL EXAM PART 1

• Question 1
2 out of 2 points
Which of the following statements is CORRECT?
Selected Answer:
If the underlying stock does not pay a dividend, it does not make good economic sense to exercise a call option prior to its expiration date, even if this would yield an immediate profit.
Correct Answer:
If the underlying stock does not pay a dividend, it does not make good economic sense to exercise a
call option prior to its expiration date, even if this would yield an immediate profit.




• Question 2
2 out of 2 points
The current price of a stock is $22, and at the end of one year its price will be either $27 or $17. The annual risk-free rate is 6.0%, based on daily compounding. A 1-year call option on the stock, with an exercise price of $22, is available. Based on the binomial model, what is the option's value? (Hint: Use daily compounding.)
• Question 3
2 out of 2 points
Which of the following statements is most correct, holding other things constant, for XYZ Corporation's traded call options?
Selected Answer:
The price of these call options is likely to rise if XYZ's stock price rises.
Correct Answer:
The price of these call options is likely to rise if XYZ's stock price rises.
• Question 4
2 out of 2 points
Other things held constant, the value of an option depends on the stock's price, the risk-free rate, and the
• Question 5
2 out of 2 points
An investor who writes standard call options against stock held in his or her portfolio is said to be selling what type of options?
Selected Answer:
Covered
Correct Answer:
Covered
• Question 15
2 out of 2 points
Suppose a firm relies exclusively on the payback method when making capital budgeting decisions, and it sets a 4-year payback regardless of economic conditions. Other things held constant, which of the following statements is most likely to be true?
MORE QUESTION HIDDEN ......................
ALL QUESTION INCLUDED A+ Graded !!!!

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