1.Tims Cafe generates four dollars in sales for every dollar the firm has invested in total assets. Which one of the following ratios would reflect this relationship?

A.ROE

B. Leverage ratio

C. Profit margin

D. Total asset turnover

2. Assume that today is year 0. Then, what is the future value of the following cash flows 9 years from now with an interest rate of 7.8 percent per year?

Year Cash Flow 2 $8,500 3 $9,300 6 $7,100

A$37,869

B $45,211

C $39,895

D $40,822

3. A positive cash flow to stockholders indicates that:

A.the amount firm paid out to shareholders exceeded net proceeds from issuing new equity.

B. firm had a positive cash flow to creditors.

C.received more from selling stock than it paid out to shareholders.

D. firm sold more shares than it repurchased.

4.Time, Inc. is expected to pay its first annual dividend of $1 per share three years from now. Starting in year 6, it is expected to start increasing the dividend by 4% per year. What is the value of this stock today at a required return of 13%?

A$8.12

B$7.16

C$7.70

D$9.64