Give explanation on each question

Question 1

The theory of finance holds that the Efficient Market Hypothesis has implications for investors and firms. Briefly explain the concept of Efficient Market Hypothesis, and clearly differentiate and illustrate the different types of market efficiency. (30 marks)

Question 2

The term dividend usually refers to distribution of earning. Distributions from earnings are dividend and distribution from capital is liquidating dividend. Briefly discuss the following six theories of dividend.

a) The transaction theory

b) Tax theories

c) The signaling theory

d) The bird in the hand theory

e) Dividend irrelevance theory

f) The agency theory of dividend (30 marks)

Question 3

Generally, a firm can choose among many alternative capital structures. It can issue a large amount of debt or it can issue a very little debt. It can issue floating-rate preferred stock warrants, convertible bonds, caps and callers. The variation in firms' capital structure is endless due to different possible combinations.

a) Discuss Modigliani & Miller proposition I

b) Discuss the following theories of capital structure

i) The Net Income Approach [NOI]

ii) The Net operating income approach

iii) The pecking order theory of capital structure

iv) Theory-Static trade-off theory of capital structure (40 marks)

Question 4

The emergence of behavioral finance in the theory of finance questioned the traditional view of the rationality of the investors as postulated by the efficient market hypothesis. Compare and contrast the efficient market hypothesis and the behavioral finance (40 marks)

Question 5

NIT-jobs program , what is it?

Question 6

Income -maximizing strategy , what is ti ? how to apply it in economics?

Question7

A positional arms race is a series of mutually offsetting investments in performance enhancement that is stimulated by a positional externality.

Question 8

A positional arms control agreement attempts to limit the mutually offsetting investments in performance enhancements by contestants

What Is this positional arms race? what is the positional arms control agreement? may you explain step by step and give examples. What does the positional externality mean?

Question 9

What is the difference between taxation and regulation in economics ? which one is more effective?

Question 10

What is the social efficient level and the difference between the social optimum level?

Is it because the social efficient level have MSB=MSC ? and the social optimum level MPB=MSC?