15 The real rate of return is the retum eamed above the O A. inflation risk premium OB. isk-adjusted retum OC. default risk premium OD. variability of retums measured by standard deviation 16. The one-year interest rate is 4%. The interest rate for a two-year security is 6%. The one-year interest rate one year from now is 8.34%. According to the liquidity preference theory, the risk premium for the second one-year investment is O A 0.30% OB. 0.50% OC. 1.66% OD.03% 17. Wheeler Corporation had retained earings as of 12/31/10 of $15 million. During 2011 Wheeler's net income was 57 milion. The retained earnings balance at the end of 2011 was equal to $20 million. Therefore, OA Whether purchased treasury stock in 2010 for 2 million OB Wheeler paid a dded in 2010 milion Oc Wheter pada dend in 2010 of $5 million On Wheeler solid common stock during 2010 for $5 million 18. The Colorado Bout Company had a cash balance of $3 million at the beginning of 2010. During 2010. Sales were $8 million and expenses were 7 milion. Therefore, OA the cash balance at the end of 2010 must be greater than $3 million OB the cash balance the end of 2010 is S4 million Oc. the cash balance at the end of 2010 carnot be determined from the information given On the cash balance at the end of 2010 must be less than $11 million 13. Which of the following best describes cash flow from trancing activities? OA. Increase for minus decrease in stock, plus increase for minus decrease) in debt, minus interest paid minus dividends paid OB interest income, plus didend income, minus taxes OC. Interest paid plus d e s paid, plus increase for minus decrease in stock, plus increase om decrease in debt OD. Interest expense, minus didends paid