Question

6) Which of the following statements concerning the constant-growth dividend valuation model is (ar) correct 1. One simple method of estimating the dividend growth rate is to analyze the historical paltem of dividends II. The expected total return equals the return from capital gains plus the return from dividends TIL. The model is applicable to growth firms with initially high growth rates. IV. The intrinsic value calculated using this method can change from one investor to another if their risk-return payoffs differ A) I and IV only B) Il and Ill only C) Illand IV only D) I, II and Ill only Answer: 7) List the key variables that affect the PE ratio and explain the relationship between each variable and the P/E ratio (a) growth rate in carings the higher the growth rate, the higher the PE ratio (b) general state of the economy, the better the economie Outlook, the higher the PE (c) amount of debt in a company's capital structure, the lower the debt ratio, the higher the PE (d) current and projected rate of inflation the lower the inflation, the higher the PE (e) level of dividends: the lower the dividend payout, the higher the PE Answer: 8) Which of the following factors are considered when analyzing an industry? I the nature and conditions of governmental regulations II the involvement and relations, if any, with labor unions III. the development of new technologies relevant to the industry IV. the extent of competition within the industry A) I, II and IV only B) II, III and IV only C) III and Ill only D) I, II, III and IV Answer: 9) Which one of the following statements concerning accounting reports is correct? A) The income statement reflects the position of a firm as of a single point in time, B) The total equity of a firm is equal to the total assets plus the total liabilities. C) The statement of cash flows identifies both the sources and the uses of cash D) The income statement reflects the amount of cash available for investment and financing activities 10) On March 31, Adolpha, Inc. reported the following information on its financial statements. Total assets Total long-term assets Totalrent libilities Total long- dubt S02174 $212864 S65.215 2005 What is the available net working capital for Adolpha, Inc.? A) -$253844 B)-$132.366 CSI21.578 D) SI873020 Answer.

Answer 1

6 ) Answer is C

8) Answer is D

9) Answer is C

10) Answer is A ( CA-CL)

Set 2

1) Answer is C

2) Answer is C

3) Answer is C

4) Answer is D (3/11%)