1. Casino Inc. expects to pay a dividend of $3 per share at the end of year 1 (D1)
and these dividends are expected to grow at a constant rate of 6% per year
forever. If the required rate of return on the stock is 18%, what is the current
value of the stock today?
A $50
B $100
C $54
D $25
2. The net present value of a project depends upon the:
A company's choice of accounting method.
B company's profitability index.
C manager's tastes and preferences.
D project's cash flows and opportunity cost of capital.
3. A government bond issued in Germany has a coupon rate of 5%, a face value
of 100 euros, and matures in five years. The bond pays annual interest
payments. Calculate the price of the bond (in euros) if the yield to maturity is
3.5%.
A 105.00
B 106.33
C 100.00
D 106.77
4. Assume the following data: EBIT = 400; Tax = 100; Sales = 3000; Average
total assets = 1500. Calculate the ROA (return on assets).
A 20%
B 10%
C 7.5%
D 26.7%
5. Florida Company (FC) and Minnesota Company (MC) are both service
companies. Their stock returns for the past three years were: FC: -5%, 15%,
20%; MC: 8%, 8%, 20%. What is the standard deviation of a portfolio with 50% of
the funds invested in FC and 50% in MC? NB ga er bij de berekeningen van uit
dat het hier om een steekproef gaat.
A 10.6%
B 14.4%
, C 9.3%
D 7.6%
6. Given the following cash flows for project Z: C0 = -1,000, C1 = 600, C2 = 720,
and C3 = 2,000, calculate the discounted payback period for the project at a
discount rate of 20%.
A > three years
B one year
C two years
D three years
7. Important points to remember while estimating the cash flows of a project are:
I) Only cash flow is relevant. II) Always estimate cash flows on an incremental
basis. III) Be consistent in the treatment of inflation.
A II and III only
B I and II only
C I only
D I, II and III
8. For project Z, year 5 inventories increase by $6,000, accounts receivable by
$4,000, and accounts payable by $3,000. Calculate the increase or decrease in
working capital for year 5.
A decreases by $1,000
B increases by $7,000
C decreases by $7,000
D increases by $5,000
9. Which of the following investment rules does NOT use the time value of
money concept?
A Net present value
B The payback period
C Profitability index
D Internal rate of return
10. A cash-flow statement categorizes cash flows into which three general
categories?
A Cash accounts, bank accounts, and transfer accounts.
B Inventory, accounts receivable, and accounts payable.
and these dividends are expected to grow at a constant rate of 6% per year
forever. If the required rate of return on the stock is 18%, what is the current
value of the stock today?
A $50
B $100
C $54
D $25
2. The net present value of a project depends upon the:
A company's choice of accounting method.
B company's profitability index.
C manager's tastes and preferences.
D project's cash flows and opportunity cost of capital.
3. A government bond issued in Germany has a coupon rate of 5%, a face value
of 100 euros, and matures in five years. The bond pays annual interest
payments. Calculate the price of the bond (in euros) if the yield to maturity is
3.5%.
A 105.00
B 106.33
C 100.00
D 106.77
4. Assume the following data: EBIT = 400; Tax = 100; Sales = 3000; Average
total assets = 1500. Calculate the ROA (return on assets).
A 20%
B 10%
C 7.5%
D 26.7%
5. Florida Company (FC) and Minnesota Company (MC) are both service
companies. Their stock returns for the past three years were: FC: -5%, 15%,
20%; MC: 8%, 8%, 20%. What is the standard deviation of a portfolio with 50% of
the funds invested in FC and 50% in MC? NB ga er bij de berekeningen van uit
dat het hier om een steekproef gaat.
A 10.6%
B 14.4%
, C 9.3%
D 7.6%
6. Given the following cash flows for project Z: C0 = -1,000, C1 = 600, C2 = 720,
and C3 = 2,000, calculate the discounted payback period for the project at a
discount rate of 20%.
A > three years
B one year
C two years
D three years
7. Important points to remember while estimating the cash flows of a project are:
I) Only cash flow is relevant. II) Always estimate cash flows on an incremental
basis. III) Be consistent in the treatment of inflation.
A II and III only
B I and II only
C I only
D I, II and III
8. For project Z, year 5 inventories increase by $6,000, accounts receivable by
$4,000, and accounts payable by $3,000. Calculate the increase or decrease in
working capital for year 5.
A decreases by $1,000
B increases by $7,000
C decreases by $7,000
D increases by $5,000
9. Which of the following investment rules does NOT use the time value of
money concept?
A Net present value
B The payback period
C Profitability index
D Internal rate of return
10. A cash-flow statement categorizes cash flows into which three general
categories?
A Cash accounts, bank accounts, and transfer accounts.
B Inventory, accounts receivable, and accounts payable.
