1. Which of the following is FALSE ?

a) Stock owners have a legal claim to a company's income

b) Stock owners become creditors of the company

c) Stocks are a major source of funding

d) Stock owners have voting rights in the company

2. Chase is interested in buying a stock that he can hold forever. The stock he is considering pays a $0.25 dividend quarterly, which Chase expects not to change. If Chase wants to earn at least 9% on this stock, what is the maximum amount he should pay for the stock?

a) 2.78

b) 11.11

c)There is not enough information to answer the question.

d) 44.44

3. In the context of stock ownership, dilution refers to which of the following:

a) the reduction in proportional ownership and its associated benefits that occurs when a company issues additional stock

b) the reduction in proportional ownership and its associated benefits that occurs when a company issues non- convertible bonds

c) the liquidation of a company

d) the right of current stock holders to buy more stock when the company issues more stock

4. Jorlynn believes there is an opportunity to earn a great return on NAMEX stock right now. In three years, she thinks she can sell it for $210. If she want a return of 21% annually over the next three years on this stock, what is the top price she should pay? NAMEX pays a quarterly dividend of $0.36.

a) 22.86

b) 212.99

c) 181.09

d) 116.79

5. a semi-strong- form efficient market , current prices______

a) reflect the price history and volume, such that charting historical prices and volumes are unlikely to consistently identifying stock buying opportunities.

b) are, by definition, difficult to obtain.

c) already reflect the price history and volume of the stock as well as all available public information.

d) already reflect the price history and volume of the stock as well as all available public information and all private (non-public) information.

Which of the following is FALSE? Stock owners have a legal claim to a company's income Stock owners become creditors of the company Stocks are a major source of funding Stock owners have voting rights in the company Question 2 (1 point) Chase is interested in buying a stock that he can hold forever. The stock he is considering pays a $0.25 dividend quarterly, which Chase expects not to change. If Chase wants to earn at least 9% on this stock, what is the maximum amount he should pay for the stock? 2.78 11.11 There is not enough information to answer the question. 44.44