Economics & Finance Study guides, Class notes & Summaries

FIN 564 Week 8 Final Exam, already graded A, (Latest 2020) Last document update:   ago

FIN 564 Week 8 Final Exam: Answer 14 of the 15 questions in the space provided. Mark the one that you want to omit by putting an “X” through the question. Should countries forgo using their own currency and adopt as legal tender a stable foreign currency? Address the following in your answer: a. Give two advantages and two disadvantages of dollarization b. Does a country need permission to dollarize? c. Would dollarization be reversible? What are the differences in the structures of the Ne...

FIN 516 Week 8 Final Exam.(REVISED CORRECT ANSWERS) Last document update:   ago

1. (TCO B) Which of the following statements concerning the MM extension with growth is NOT CORRECT? (a) The tax shields should be discounted at the unlevered cost of equity.] (b) The value of a growing tax shield is greater than the value of a constant tax shield. (c) For a given D/S, the levered cost of equity is greater than the levered cost of equity under MM’s original (with tax) assumptions. (d) For a given D/S, the WACC is greater than the WACC under MM’s original (with tax) assumptio...