A project requires an investment outlay of $100 immediately. The project will generate after-tax cash flows of $50 one year from now and $60 two years from now. What is the IRR of the project?
A) 5.39%
B) 6.39%
C) 10.39%
D) 12.39%
E) 14.39%
B
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The following information applies to Acorn Construction Company (ACC):?Year 2Year 1Net sales$ 880,000$ 600,000Income before interest and taxes127,50084,000Net income59,00052,000Interest expense24,50015,000Stockholders' equity, December 31810,300725,000Common stock750,300700,000Preferred stock dividends24,00024,000Information on the number of shares outstanding is provided below:Avg. # of shares outstanding Year 138,000Avg. # of shares outstanding Year 233,000Required:Compute the following ratios for ACC for Year 2 and Year 1:(a) Number of times interest is earned(b) Earnings per share(c) Price-earnings ratio (Market prices: Year 2 $17.50 per share, Year 1 $15.00 per share)(d) Return on equity(e) Net margin.
What will be an ideal response?
The conflict of interest in credit-rating agencies arises because ________ pay to have securities rated and, as a result, the agencies' ratings may be biased ________
A) security issuers; downward B) security issuers; upward C) investors; downward D) regulators; upward
If a data flow appears on the context diagram and is also represented on a level-0 diagram, this would be referred to as:
A) leveling. B) flow conservation. C) balancing. D) cohesion. E) coupling.
Which of the following is the best statement of the efficient markets hypothesis?
A) Investors with information that a stock had a positive net present value (NPV) will buy it, while investors with information that a stock had a negative net present value (NPV) will sell it. B) Investor's decisions are dependent on complete current information of a firm's cash flows and accurate predictions of future cash flows. C) Competition between investors works to make the net present value (NPV) of all trading opportunities zero. D) A share's price is the aggregate of the information of many investors.