1. The theory is a principle that is used to explain and resolve issues in the relationship between business princlpals and their agents. A. Trade. B. Game. C. Agency. D. Capital. 2. Cost of cepital is equal to the required return rate on equity in case If investors are only A. Valuation managers. B. Common stockholders. C. Asset seller. D. Equily dealer. 3. Inventory is listed as a part of current assats. Stock or inventory in a manufacturing organization means A. Goods that are readily available for sale. B. All the assets are avallable for sale. C. All the raw material, semi-finished and finlahed goods in the organization. D. Goods that can be sold within a short span of time. 4. Which of the following is another name for the required return on a stock? A. Value. B. Retention ratio. C. Discount rate, D. Dlvidend payout ratio. PAGE 2 OF 15 CONFIDENTIAL 8. gives the holder the right, but not the obligation, to buy or sell a given quantity of an asset on or before a given date, at prices agreed upon today. A. Future. B. Derivatives. C. Options. D. Contract. 9. is the proposition that current stock prices fully reflect the avallable information about the value of the firm. A. Secured debt. B. Unsecured dobt. C. Efficient market hypothesis. D. Bond market. 10. Which of these is an appropriate measure of individual systematic share risk (i.e. the risk of single share held as part of a portfolio)? A. Variance. B. Bete. C. standard deviation. D. Correlation. 11. Which of the following adopt Nat Profit as basis for calculation? A. Net present value. B. Average rate of retum. C. Internal rate of return. D. Payback period