dittoaivy

Megan Ross holds the following portfolio: Stock Investment Beta A $150,000 1.40 B 50,000 0.80 C 100,000 1.00 D 75,000 1.20 Total $375,000 What is the portfolio's beta? a. 1.17 b. 1.56 c. 1.29 d. 1.42 e. 1.06

Question 9

Bruce Niendorf holds the following portfolio:

Stock Investment Beta
A $150,000 1.40
B 50,000 0.80
C 100,000 1.00
D 75,000 1.20
Total $375,000


Bruce plans to sell Stock A and replace it with Stock E, which has a beta of 0.75. By how much will the portfolio beta change?
Answer

-0.190

-0.211

-0.234

-0.260

-0.286

Question 8

Jim Angel holds a $200,000 portfolio consisting of the following stocks:

Stock Investment Beta
A $ 50,000 0.95
B 50,000 0.80
C 50,000 1.00
D 50,000 1.20
Total $200,000


What is the portfolio's beta?
Answer

0.938

0.988

1.037

1.089

1.143

Desreumaux Inc's stock has an expected return of 12.25%, a beta of 1.25, and is in equilibrium. If the risk-free rate is 5.00%, what is the market risk premium?
5.80%
5.95%
6.09%
6.25%
6.40%

Question 8

Jim Angel holds a $200,000 portfolio consisting of the following stocks:

Stock
Investment
Beta
A
$ 50,000
0.95
B
50,000
0.80
C
50,000
1.00
D
50,000
1.20
Total
$200,000


What is the portfolio's beta?

0.938
0.988
1.037
1.089
1.143

Question 9

Bruce Niendorf holds the following portfolio:

Stock
Investment
Beta
A
$150,000
1.40
B
50,000
0.80
C
100,000
1.00
D
75,000
1.20
Total
$375,000


Bruce plans to sell Stock A and replace it with Stock E, which has a beta of 0.75. By how much will the portfolio beta change?

-0.190
-0.211
-0.234
-0.260
-0.286

Question 10

Company A has a beta of 0.70, while Company B's beta is 1.20. The required return on the stock market is 11.00%, and the risk-free rate is 4.25%. What is the difference between A's and B's required rates of return? (Hint: First find the market risk premium, then find the required returns on the stocks.)
Answer
2.75%
2.89%
3.05%
3.21%
3.38%


Question 12

If markets are in equilibrium, which of the following conditions will exist?

Each stock's expected return should equal its realized return as seen by the marginal investor.
Each stock's expected return should equal its required return as seen by the marginal investor.
All stocks should have the same expected return as seen by the marginal investor.
The expected and required returns on stocks and bonds should be equal.
All stocks should have the same realized return during the coming year.

Question 13

The preemptive right is important to shareholders because it

allows managers to buy additional shares below the current market price.
will result in higher dividends per share.
is included in every corporate charter.
protects the current shareholders against a dilution of their ownership interests.
protects bondholders, and thus enables the firm to issue debt with a relatively low interest rate.

Question 14

Stocks A and B have the following data. Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT?


A
B
Required return
10%
12%
Market price
$25
$40
Expected growth
7%
9%

These two stocks should have the same price.
These two stocks must have the same dividend yield.
These two stocks should have the same expected return.
These two stocks must have the same expected capital gains yield.
These two stocks must have the same expected year-end dividend.

Question 15

Which of the following statements is CORRECT?

Preferred stockholders have a priority over bondholders in the event of bankruptcy to the income, but not to the proceeds in a liquidation.
The preferred stock of a given firm is generally less risky to investors than the same firm's common stock.
Corporations cannot buy the preferred stocks of other corporations.
Preferred dividends are not generally cumulative.
A big advantage of preferred stock is that dividends on preferred stocks are tax deductible by the issuing corporation.

Question 16

A stock just paid a dividend of D0 = $1.50. The required rate of return is rs = 10.1%, and the constant growth rate is g = 4.0%. What is the current stock price?

$23.11
$23.70
$24.31
$24.93
$25.57
Question 18

If D1 = $1.50, g (which is constant) = 6.5%, and P0 = $56, what is the stock's expected capital gains yield for the coming year?

6.50%
6.83%
7.17%
7.52%
7.90%

Question 19

Sorenson Corp.'s expected year-end dividend is D1 = $1.60, its required return is rs = 11.00%, its dividend yield is 6.00%, and its growth rate is expected to be constant in the future. What is Sorenson's expected stock price in 7 years, i.e., what is ?

$37.52
$39.40
$41.37
$43.44
$45.61

Question 20

Nachman Industries just paid a dividend of D0 = $1.32. Analysts expect the company's dividend to grow by 30% this year, by 10% in Year 2, and at a constant rate of 5% in Year 3 and thereafter. The required return on this low-risk stock is 9.00%. What is the best estimate of the stock's current market value?

$41.59
$42.65
$43.75
$44.87
$45.99

A) will result in higher dividends per share.
B) allows managers to buy additional shares below the currentmarket price.
C) is included in every corporate charter.
D) protects the current shareholders against a dilution of theirownership interests.
E) protects bondholders, and thus enables the firm to issue debtwith a relatively low interest rate.

15. The preemptive right is important to shareholders because it

a. allows managers to buy additional shares below the current market price.

b. protects bondholders, and thus enables the firm to issue debt with a relatively low interest rate.

c. protects the current shareholders against a dilution of their ownership interests.

d. is included in every corporate charter.

True or False: As long as the firm is certain that the return on assets will be higher than the interest rate, an issue of debt makes the shareholders better off. 

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I need five links to online free finance journals that talkabout financial advising jobs

"What are the potential long-term consequences of ongoing climate change on global ecosystems and human societies, and what actions can be taken on a global scale to mitigate these effects?"