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FIN 534 Innovative Educator/fin534.com

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FIN 534 Entire Course (Str Course) For more course tutorials visit www.fin534.com FIN 534 Week 1 Chapter 1 Solution FIN 534 Week 1 Chapter 2 Solution FIN 534 Week 2 Chapter 3 Solution FIN 534 Week 3 Chapter 4 Solution FIN 534 Week 3 Chapter 5 Solution FIN 534 Week 4 Chapter 6 Solution – PowerPoint PPT presentation

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Title: FIN 534 Innovative Educator/fin534.com


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FIN 534 Innovative Educator/fin534.com
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FIN 534 Innovative Educator
  • FIN 534 Entire Course (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • FIN 534 Week 1 Chapter 1 Solution
  • FIN 534 Week 1 Chapter 2 Solution
  • FIN 534 Week 2 Chapter 3 Solution
  • FIN 534 Week 3 Chapter 4 Solution
  • FIN 534 Week 3 Chapter 5 Solution

3
FIN 534 Innovative Educator
  • FIN 534 Week 1 Chapter 1 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements is CORRECT?
  • a. One of the disadvantages of a sole
    proprietorship is that the proprietor is exposed
    to unlimited liability.
  • b. It is generally easier to transfer ones
    ownership interest in a partnership than in a
    corporation.

4
FIN 534 Innovative Educator
  • FIN 534 Week 1 Chapter 2 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements is CORRECT?
  • a. Typically, a firms DPS should exceed its EPS.
  • b. Typically, a firms EBIT should exceed its
    EBITDA.
  • c. If a firm is more profitable than average
    (e.g., Google), we would normally expect to see
    its stock price exceed its book value per share.

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FIN 534 Innovative Educator
  • FIN 534 Week 1 DQ 1 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Imagine a startup company of your own and briefly
    trace its development from a sole proprietorship
    to a major corporation with a focus on how that
    development would be financed.

6
FIN 534 Innovative Educator
  • FIN 534 Week 1 DQ 2 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Discuss ways that the basic concepts we have
    discussed in this chapter directly impact your
    life. Provide specific examples to support your
    response.

7
FIN 534 Innovative Educator
  • Fin 534 Week 1 Quiz 1 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Question 1
  • You recently sold 100 shares of your new company,
    XYZ Corporation, to your brother at a family
    reunion. At the reunion your brother gave you a
    check for the stock and you gave your brother the
    stock certificates. Which of the following
    statements best describes this transaction?

8
FIN 534 Innovative Educator
  • FIN 534 Week 2 Chapter 3 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1. Which of the following statements is CORRECT?
  • a. The ratio of long-term debt to total capital
    is more likely to experience seasonal
    fluctuations than is either the DSO or the
    inventory turnover ratio.
  • b. If two firms have the same ROA, the firm with
    the most debt can be expected to have the lower
    ROE.
  • c. An increase in the DSO, other things held
    constant, could be expected to increase the total
    assets turnover ratio.

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FIN 534 Innovative Educator
  • FIN 534 Week 3 Chapter 4 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 11. A 50,000 loan is to be amortized over 7
    years, with annual end-of-year payments. Which of
    these statements is CORRECT?
  • a. The annual payments would be larger if the
    interest rate were lower.
  • b. If the loan were amortized over 10 years
    rather than 7 years, and if the interest rate
    were the same in either case, the first payment
    would include more dollars of interest under the
    7-year amortization plan.

10
FIN 534 Innovative Educator
  • FIN 534 Week 3 Chapter 5 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1
  • . Three 1,000 face value bonds that mature in 10
    years have the same level of risk, hence their
    YTMs are equal. Bond A has an 8 annual coupon,
    Bond B has a 10 annual coupon, and Bond C has a
    12 annual coupon. Bond B sells at par. Assuming
    interest rates remain constant for the next 10
    years, which of the following statements is
    CORRECT?
  • a. Bond As current yield will increase each year.

11
FIN 534 Innovative Educator
  • FIN 534 Week 3 Quiz 2 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1 Question 1
  • Which of the following statements is CORRECT?
  • a. Since companies can deduct dividends paid but
    not interest paid, our tax system favors the use
    of equity financing over debt financing, and this
    causes companies debt ratios to be lower than
    they would be if interest and dividends were both
    deductible.

12
FIN 534 Innovative Educator
  • FIN 534 Week 4 Chapter 6 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements is CORRECT?
  • a. If you add enough randomly selected stocks to
    a portfolio, you can completely eliminate all of
    the market risk from the portfolio.
  • b. If you were restricted to investing in
    publicly traded common stocks, yet you wanted to
    minimize the riskiness of your portfolio as
    measured by its beta, then according to the CAPM
    theory you should invest an equal amount of money
    in each stock in the market.

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FIN 534 Innovative Educator
  • FIN 534 Week 4 Chapter 7 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1. Which of the following statements is CORRECT?
  • a. The constant growth model takes into
    consideration the capital gains investors expect
    to earn on a stock.
  • b. Two firms with the same expected dividend and
    growth rates must also have the same stock price.
  • c. It is appropriate to use the constant growth
    model to estimate a stock's value even if its
    growth rate is never expected to become constant.

14
FIN 534 Innovative Educator
  • FIN 534 Week 4 Chapter 7 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1. Which of the following statements is CORRECT?
  • a. The constant growth model takes into
    consideration the capital gains investors expect
    to earn on a stock.
  • b. Two firms with the same expected dividend and
    growth rates must also have the same stock price.
  • c. It is appropriate to use the constant growth
    model to estimate a stock's value even if its
    growth rate is never expected to become constant.

15
FIN 534 Innovative Educator
  • FIN 534 Week 4 Quiz 3 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements is CORRECT?
  • 1) A time line is not meaningful unless all
    cash flows occur annually
  • 2) Time lines are useful for visualizing
    complex problems prior to doing actual
    calculations
  • 3) Time lines cannot be constructed to deal
    with situations where some of the cash flows
    occur annually but others occur quarterly

16
FIN 534 Innovative Educator
  • FIN 534 Week 5 Chapter 8 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1. Which of the following statements is CORRECT?
  • a. Put options give investors the right to buy a
    stock at a certain strike price before a
    specified date.
  • b. Call options give investors the right to sell
    a stock at a certain strike price before a
    specified date.
  • c. Options typically sell for less than their
    exercise value.

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FIN 534 Innovative Educator
  • FIN 534 Week 5 Chapter 9 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1. Bankston Corporation forecasts that if all of
    its existing financial policies are followed, its
    proposed capital budget would be so large that it
    would have to issue new common stock. Since new
    stock has a higher cost than retained earnings,
    Bankston would like to avoid issuing new stock.
    Which of the following actions would REDUCE its
    need to issue new common stock?
  • a. Increase the dividend payout ratio for the
    upcoming year.

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FIN 534 Innovative Educator
  • FIN 534 Week 5 Quiz 4 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1.Finance 534 week 5 quiz 4
  • Question 1
  • Assume that in recent years both expected
    inflation and the market risk premium (rM
  • - rRF) have declined. Assume also that all
    stocks have positive betas. Which of the
    following would be most likely to have occurred
    as a result of these changes?

19
FIN 534 Innovative Educator
  • FIN 534 Week 6 Chapter 10 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 11. Which of the following statements is CORRECT?
  • a. The internal rate of return method (IRR) is
    generally regarded by academics as being the best
    single method for evaluating capital budgeting
    projects.
  • b. The payback method is generally regarded by
    academics as being the best single method for
    evaluating capital budgeting projects.

20
FIN 534 Innovative Educator
  • FIN 534 Week 6 Chapter 11 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements is CORRECT?
  • a. An externality is a situation where a project
    would have an adverse effect on some other part
    of the firms overall operations. If the project
    would have a favorable effect on other
    operations, then this is not an externality.
  • b. An example of an externality is a situation
    where a bank opens a new office, and that new
    office causes deposits in the banks other
    offices to decline.

21
FIN 534 Innovative Educator
  • FIN 534 Week 7 Chapter 12 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements is CORRECT?
  • a. Perhaps the most important step when
    developing forecasted financial statements is to
    determine the breakdown of common equity between
    common stock and retained earnings.
  • b. The first, and perhaps the most critical, step
    in forecasting financial requirements is to
    forecast future sales.
  • c. Forecasted financial statements, as discussed
    in the text, are used primarily as a part of the
    managerial compensation program, where
    managements historical performance is evaluated.

22
FIN 534 Innovative Educator
  • FIN 534 Week 7 Chapter 13 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Suppose Leonard, Nixon, Shull Corporations
    projected free cash flow for next year is
    100,000, and FCF is expected to grow at a
    constant rate of 6. If the companys weighted
    average cost of capital is 11, what is the value
    of its operations?

23
FIN 534 Innovative Educator
  • FIN 534 Week 7 Quiz 6 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Finance 534 week 7 quiz 6
  • Question 1
  • Which of the following statements is CORRECT?
  • Answer
  • Question 2
  • Which of the following statements is CORRECT?
  • Question 3

24
FIN 534 Innovative Educator
  • FIN 534 Week 8 Chapter 14 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • 1. Which of the following statements about
    dividend policies is CORRECT?
  • a. Modigliani and Miller argue that investors
    prefer dividends to capital gains because
    dividends are more certain than capital gains.
    They call this the ?bird-in-the hand? effect.
  • b. One reason that companies tend to avoid stock
    repurchases is that dividend payments are taxed
    at a lower rate than gains on stock repurchases.

25
FIN 534 Innovative Educator
  • FIN 534 Week 8 Chapter 15 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Which of the following statements best describes
    the optimal capital structure?
  • a. The optimal capital structure is the mix of
    debt, equity, and preferred stock that maximizes
    the companys earnings per share (EPS).
  • b. The optimal capital structure is the mix of
    debt, equity, and preferred stock that maximizes
    the companys stock price.

26
FIN 534 Innovative Educator
  • FIN 534 Week 8 Quiz 7 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Finance 534 week 8 quiz 7
  • This quiz consist of 30 multiple choice
    questions. The first 15 questions cover the
    material in Chapter 12. The second 15 questions
    cover the material in Chapter 13. Be sure you are
    in the correct Chapter when you take the quiz.
  • Question 1

27
FIN 534 Innovative Educator
  • FIN 534 Week 9 Chapter 16 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Swim Suits Unlimited is in a highly seasonal
    business, and the following summary balance sheet
    data show its assets and liabilities at peak and
    off-peak seasons (in thousands of dollars)
  • Peak Off-Peak
  • Cash 50 30
  • Marketable securities 0 20

28
FIN 534 Innovative Educator
  • FIN 534 Week 9 Quiz 8 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Question 1
  • Which of the following statements about dividend
    policies is correct?
  • Question 2
  • If a firm adheres strictly to the residual
    dividend policy, the issuance of new common stock
    would suggest that
  • Question 3

29
FIN 534 Innovative Educator
  • FIN 534 Week 10 Chapter 17 Solution (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • In Japan, 90-day securities have a 4 annualized
    return and 180-day securities have a 5
    annualized return. In the United States, 90-day
    securities have a 4 annualized return and
    180-day securities have an annualized return of
    4.5. All securities are of equal risk, and
    Japanese securities are denominated in terms of
    the Japanese yen. Assuming that interest rate
    parity holds in all markets, which of the
    following statements is most CORRECT?

30
FIN 534 Innovative Educator
  • FIN 534 Week 10 Quiz 9 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Question 1
  • Which of the following statements is NOT CORRECT?
  • Question 2
  • Which of the following statements is CORRECT?
  • Question 3
  • Which of the following statements is CORRECT?
  • Answer

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FIN 534 Innovative Educator
  • FIN 534 Week 11 Quiz 10 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Finance 534 week 11 quiz 10
  • Question 1
  • Suppose DeGraw Corporation, a U.S. exporter, sold
    a solar heating station to a Japanese customer at
    a price of 143.5 million yen, when the exchange
    rate was 140 yen per dollar. In order to close
    the sale, DeGraw agreed to make the bill payable
    in yen, thus agreeing to take some exchange rate
    risk for the transaction.

32
FIN 534 Innovative Educator
  • FIN 536 Week 6 Quiz 5 (Str Course)
  • For more course tutorials visit
  • www.fin534.com
  • Finance 534 week 6 Quiz5
  • Question 1
  • Call options on XYZ Corporations common stock
    trade in the market. Which of the following
    statements is most correct, holding other things
    constant?
  • Question 2 .

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FIN 534 Innovative Educator
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