> A Moving to another question will save this response. < < Question 21 of 35 Question 21 2.5 points Save Answer Next year's risk-free rate is expected to be 3% per annum, and the return on the market portfolio is expected to be 8% per annum. The beta of AXYS Ltd. stock is 1. Sun Tan Ltd., a company trying to compete with AXYS Ltd., is considered to carry twice the amount of systematic risk of AXYS Ltd but only half the amount of unsystematic risk of AXYS Ltd. Based on the capital asset pricing model, the expected return on Sun Tan Ltd. stock over the next year is closest to: O A. 13.00% O B. 11.00% O C. 18.00% O D. 5.50% Moving to another question will save this response. < < Question 21 of 35 > > Q Search L O . 2 ENG 12:05 PM 1/13/2023Moving to another question will save this response. < < Question 22 of 35 > > Question 22 2.5 points Save Answer Calculate the price of a three-year zero-coupon bond with a face value of E100 issued by Mondeo Taurus Plc. The average yield to maturity on bonds issued by companies in the same industry as Mondeo Taurus Plc is 8.6% (i.e., industry average YTM). As Mondeo Taurus Pic is the leading company in the industry and its bonds are rated safer, its yield to maturity is set at 2% below the industry average, i.e., (industry average YTM minus 2%). The price of the three-year zero-coupon bond with a face value of E100 issued by Mondeo Taurus Pic is closest to: A. E82.55 B. E99.06 O C. E78.45 OD. E115.57 A Moving to another question will save this response. < < Question 22 of 35 > > Q Search T ENG 12:05 PM 1/13/2023Question Completion Status: -> Moving to another question will save this response. < < Question 24 of 35 > > Question 24 2.5 points Save Answer You are planning an investment in mining in an African country. You plan to invest E5 million. You contacted an investment banker who advises you to issue corporate bonds to raise the required funding. The bonds will be issued in units of E10,000 each (i.e., the face value of one unit of the corporate bond is $10,000). The maturity of the bond will be 8 years. Bonds of companies with similar ventures are trading with a yield to maturity of 8% per annum. To entice investors to buy the bonds, the investment banker recommends setting a price below the face value. Assume that you agree to issue the bonds at a price below the face value. How many units of the corporate bond need to be issued or will be issued? O A. Less than 200 units O B. 500 units O C. Less than 500 units O D. More than 500 units Moving to another question will save this response. < < Question 24 of 35 > >> SearchQuestion Completion Status: > Moving to another question will save this response. << < Question 25 of 35 > > Question 25 2.5 points Save Answer The stock price of a company is currently E50. Its current dividend per share is $1.25. The dividend per share has historically grown at the rate of 4% per annum, and this growth rate is expected to continue for the foreseeable future. If the shareholders demand a rate of return of 6.6%, their expectations of the capital gains yield will be closest to: O A. Cannot be determined O B. 4.00% O C. 2.60% O D. 2.50% A Moving to another question will save this response. < < Question 25 of 35 > > Q Search ENG 12:06 PM 1/13/2023A Moving to another question will save this response. Question 26 A stock is currently trading at E35. The latest dividend paid is $1.25 Dividends grow at a rate of 4% per annum. The cost of equity is 8% p.a. The stock price is currently O A. Overvalued O B. Correctly valued O C. worth close to zero. O D. Undervalued > Moving to another question will save this response.Question Completion Status: > A Moving to another question will save this response. < < Question 27 of Question 27 2.5 points Save A Which of the following statements is FALSE? O A. The value of the shares of common stock of companies that do not pay a dividend is zero. O B. Buying a share of common stock entitles the buyer to partial ownership of the corporation. O C. The value of a share of common stock is dependent on the performance of the corporation. O D. The market price of a share of common stock of a publicly-listed company is determined by demand and supply forces that manifest themselves in the stock market. A Moving to another question will save this response. < < Question 27 of 35 Q Search T ENGQuestion Completion Status: -> Moving to another question will save this response. < < Question 28 of 35 > >> Question 28 2.5 points Save Answer An entrepreneur started a new venture. Private equity shareholders have contributed E3.8 million in capital. Venture capitalists, as a separate group of owners, have provided E1.2 million in capital. A private bank (backed by Hedge Funds) has supplied E1,500,000 as a long-term loan at an interest rate of 7% per annum. The first year's EBITDA (i.e., Revenue - Cost of Goods Sold - Selling, General & Administrative Expenses) is E420,000. Non-cash expenses in the form of Depreciation & Amortization amount to E60,000. The corporation tax rate is 25%. The return on invested capital (i.e., ROIC) is closest to: O A. 7.12% O B. 5.09% O C. 3.83% O D. 4.15% Q Search ENG 12:06 PMQuestion Completion Status: > A Moving to another question will save this response. Question 30 Which one of the following is not one of the Balanced Scorecard's four generic perspectives? O A. innovation and learning O B. financial O C. marketing and advertising O D. internal business processes Ly A Moving to another question will save this response. Search LQuestion Completion Status: H IVTOVIng TO anTOLITer question will save this response. Question 31 of 35 > > Question 31 2.5 points Save Answer A firm is considering a few plans in relation to its working capital management as follows: Plan 1: Increase credit sales (i.e., accounts receivables), which in turn leads to higher profitability. However, this increases the amount of tax paid to the government. Besides, if the company increases revenue, there will be more sales made to low-credit quality customers. Plan 2: Buy more goods from suppliers to incentivize them to provide more extended credit periods. However, the risk is that inventory level increases, and at the same time, more suppliers will not agree to lengthen the credit period. Indeed, a majority of suppliers will decrease the credit period provided to the firm. The net effect is that the accounts payables will decrease. Plan 3: Increase inventory level so that the no-growth firm never runs out of stock and keeps its customers satisfied. Plan 4: Maximize the firm's cash cycle. Which of the plans mentioned above would increase the firm's cash from operating activities? O A. Plan 4 only O B. None of plans 1, 2, 3 and 4, i.e., none of the plans O C. All of plans 1, 2, 3 and 4, i.e., all of the plans O D. Plans 1 and 3 Q Search T ENG 12:08 PM 1/13/2023AMoving to another question will save this response. < < Question 32 of 35 > > Question 32 2.5 points Save Answer You are planning an investment in mining in an African country. You plan to invest $5 million. You contacted an investment banker who advises you to issue corporate bonds to raise the required funding. The bonds will be issued in units of E10,000 each (i.e., the face value of one unit of the corporate bond is E10,000). The maturity of the bond will be 8 years. Bonds of companies with similar ventures are trading with a yield to maturity of 8% per annum. To entice investors to buy the bonds, the investment banker recommends setting a price below the face value. Which of the following will ensure that the bond's initial price (or offer price or simply price for short) will be below its face value? A. Selling the bond at a premium O B. Setting the coupon rate below 8% per annum O C. Setting the coupon rate at 8% per annum O D. Setting the coupon rate above 8% per annum Moving to another question will save this response. Question 32 of 35 Search T ENG 12:08 PM 1/13/2023Question Completion Status: Question 33 2.5 points Save Answer Handa Group, a car maker, is made up of two units as follows: Unit 1: Handa Engines Unit 2: Handa Assembly & Sales (A&S) Handa Engines supplies car engines to Handa Assembly & Sales (A&S). The cost of making one engine is $6,000. Once the engines are shipped to Handa Assembly & Sales (A&S), they go in the assembly of cars. At Handa Assembly & Sales (A&S), the total cost of assembling and selling a car, excluding the engine cost sourced from Handa Engines, is $14,000. Given the internal competition, Handa Engines and Handa Assembly & Sales (A&S) are treated as autonomous, independent units by Handa Group. The manager of Handa Engines wants to report a high profit for its unit. She has set the new transfer price of an engine at cost + 40% markup. In other words, if the cost is X, then the transfer price is 1.4X. Prior to the change, the engines were transferred at cost from Handa Engines to Handa Assembly & Sales (A&S). Due to increased competition and the uncertainty prevailing globally, the completed cars by Handa Group can only be sold for $21,000 per unit. The new transfer price set by the manager of Handa Engines will cause the profitability of Handa Group to: A. remain unchanged B. increase O C. decrease but not turn into a loss D. turn into a loss SearchRemaining Time: 1 hour, 50 minutes, 34 seconds. Question Completion Status: >Click Submit to complete this assessment. Question 35 of 35 Question 35 2.5 points Save Answer Financial information is a representation of a company's operations and wealth in figures. Which of the following is not a purpose of financial information? O A. Use to assess the effectiveness of corporate governance, for instance, managers' compensation in relation to the firm size, operations, and profitability, among others. O B. To identify a range of existing and potential users of financial information. O C. To measure and reward performance and to identify areas of improvement. O D. Investors use financial information to determine the investment appeal of the firm. Click Submit to complete this assessment. < < Question 35 of 35 Save and Submit Show desktop Q Search