Attempt History
Attempt Time Score Regraded
LATEST Attempt 1 224 minutes 70 out of 107 70 out of 107
Correct answers are no longer available.
Score for this quiz: 70 out of 107
Submitted Oct 6 at 6:04pm
This attempt took 224 minutes.
Question 1 pts
(True/False). To create economic value, it's only necessary that a firm
create positive accounting profits.
True
False
Question 2 pts
, One advantage of the NPV method for capital budgeting rather than the
discounted payback period method is that the NPV method .
Choose the best answer from the options below.
considers all cash flows
considers the time value of money
does not require a computer or calculator to calculate
does not require knowing the cost of capital
is more intuitive
Question 3 pts
If a firm’s Return on Equity is less than its Discount Rate, then an
increase in retention of earnings will firm value since
reinvested capital earns than the cost of capital.
increase, less
decrease, more
decrease, less
increase, more
Incorrect Question 4 pts
,
, Incorrect Question 5 pts
Which one of these applies to the dividend growth model of stock
valuation?
The dividend must be for the same time period as the stock price
The growth rate must be less than the discount rate
The rate of growth must be positive
The model cannot be applied if the growth rate is zero
The dividend amount must be constant over time
Question 6 pts
(True/False). When the inflation rate is increasing, the spread between
nominal rates and real rates will increase.
True
False
Question 7 pts
For an investor in US companies which of the following risks can be
mitigated through portfolio diversification?
An unexpected entry of a competitor
Attempt Time Score Regraded
LATEST Attempt 1 224 minutes 70 out of 107 70 out of 107
Correct answers are no longer available.
Score for this quiz: 70 out of 107
Submitted Oct 6 at 6:04pm
This attempt took 224 minutes.
Question 1 pts
(True/False). To create economic value, it's only necessary that a firm
create positive accounting profits.
True
False
Question 2 pts
, One advantage of the NPV method for capital budgeting rather than the
discounted payback period method is that the NPV method .
Choose the best answer from the options below.
considers all cash flows
considers the time value of money
does not require a computer or calculator to calculate
does not require knowing the cost of capital
is more intuitive
Question 3 pts
If a firm’s Return on Equity is less than its Discount Rate, then an
increase in retention of earnings will firm value since
reinvested capital earns than the cost of capital.
increase, less
decrease, more
decrease, less
increase, more
Incorrect Question 4 pts
,
, Incorrect Question 5 pts
Which one of these applies to the dividend growth model of stock
valuation?
The dividend must be for the same time period as the stock price
The growth rate must be less than the discount rate
The rate of growth must be positive
The model cannot be applied if the growth rate is zero
The dividend amount must be constant over time
Question 6 pts
(True/False). When the inflation rate is increasing, the spread between
nominal rates and real rates will increase.
True
False
Question 7 pts
For an investor in US companies which of the following risks can be
mitigated through portfolio diversification?
An unexpected entry of a competitor
