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3 and 4 are correct. #5 is not B i think it might be C. can you please confirm? Remaining Time: 1 hour, 25 minutes,

3 and 4 are correct. #5 is not B i think it might be C. can you please confirm? image text in transcribed
image text in transcribed
image text in transcribed
Remaining Time: 1 hour, 25 minutes, 23 seconds. Question Completion Status: QUESTION 5 The difference between the total amount available to all investors in question 3 and the total amount available to all investors in question 4 (amount in Q3 - amount in Q4) is interest tax shield in question 2. Ignore the rounding error. A. greater than B. smaller than C. equal to D. Cannot be determined. QUESTION 6 Which of the following is NOT one of the simplifying assumptions made for the WACC method? A. Market risk of the project is the same as the average market risk of the firm's investments. emaining Time: 1 hour, 24 minutes, 43 seconds. Question Completion Status: QUESTION 3 Year 2006 EBIT 2,035 510 Inter expense Earnings before tax Taxes (35%) 1,525 534 Net Income 991 The total amount available to pay out to all the investors (shareholders and debt holders) in ABC in 2006 is closest to: A. $990 million B. $1,525 million C. $1,500 million D. $2,035 million Click Save and Submittem. Remaining Time: 1 hour, 24 minutes, 20 seconds. * Question Completion Status: QUESTION 4 Year 2006 EBIT 2,035 Interest expense 510 Earnings before tax 1,525 Taxes (35%) 534 Net Income 991 The total amount that would be available to equity holders in 2006 if ABC was not levered is closest to: A. $1,525 million B. $2,035 million C. $1,500 million D. $1,325 million

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