a)

A company recently acquired an equipment with a useful life of 5 years. It has an initial cost of $1 million and expected annual cost of $50,000 on years 1 to 5. The tax rate is 25% and the discount rate is 15%. The equipment will be depreciated using the straight line method. What is the annual depreciation tax shield?

Select one:

a. $150,000

b. $50,000

c. None of THESE

d. $200,000

b)

The returns on the stock of COSTA Corp. over the last 4 years are as follows: 2016: +10%, 2017: -8%, 2018: +12%, and 2019: -5%. What was the realized annual return?

Select one:

a. +1.87%

b. -1.57%

c. +4.29%

d. +2.25%

e. None of THESE

c)

At the beginning of 2019, Valentina invested in a stock with a share price of $100. She received a cash dividend of $2 per share at the end of the year. If the total return obtained was 2%, then the share price at the end of the year was __________.

Select one:

a. None of THESE

b. $104

c. $102

d. $100

d)

Which of the following statements is true?

Select one:

a. Under cumulative voting, minority shareholders have the possibility to choose some members to the board of directors.

b. Proxy is a legal grant of authority by a shareholder to someone else to vote his/her shares.

c. All of THESE

d. Under straight voting, shareholders with majority of votes can choose all the members to the board of directors.