Which of the following statements concerning the required rate of return on stocks is true?
A) If risk is reduced, the required return will decrease because more investors are risk-averse.
B) The higher the risk, the higher the required return, other things being equal.
C) The required return on preferred stock is generally higher than the required return on
common stock.
D) The higher an investor's required rate of return, the higher the value of the stock.
B
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Answer the following statement true (T) or false (F)
A 2-for-1 stock split will have the same effect on the number of shares outstanding as a 200 percent stock dividend
Indicate whether the statement is true or false
One advantage of using swaps to eliminate interest-rate risk is that swaps
A) are less costly than futures. B) are less costly than rearranging balance sheets. C) are more liquid than futures. D) have better accounting treatment than options.
Core ______ is the group’s reason for being that reflects the ideals of its members.
A. integrity B. trust C. purpose D. rules