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1 . Define, explain, and give six examples of market risk and unique risk. 2 . Explain the relationship between compounding and discounting of assets.

1. Define, explain, and give six examples of market risk and unique risk.
2. Explain the relationship between compounding and discounting of assets.
3. Identify some more important rights that come with stock ownership and define the following terms: proxy, proxy fight, takeover, preemptive right.
4. Explain what is meant by a firms weighted average cost of capital and optimum cost of capital.
6. Define capital budgeting process, explain why it is important, and state how project proposals are generally classified.
7. Identify and explain the purpose of post-audit in the capital budgeting process.
8. Explain why capital structure policy involves a trade-off between risk and return, and list the four primary factors that influence capital structure decisions.
9. Define and discuss the capital market theory in detail.
10. Explain the differences between the Capital Market Line and Security Market Line.
11. List a number of factors or practical considerations firms generally consider when making capital structure decisions.
12. Discuss the significance of Dividend Discount Model.

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