I have a few questions for you to help with please! I am under deadline less than one hour....

A major issue with venture capitalists and angel investors is the rate at which their funds will be used up. This is called the ________.

• depreciation rate
• burn rate or bleed rate
• consumption or constriction rate
• IV rate

5

Which of the following is NOT a generally accepted way to remove ineffective management of a publicly traded firm?

• The shareholders can vote out directors who won't discipline managers.
• Each of the above are recognized methods for the removal of ineffective management.
• The Board of Directors can vote to remove management.
• Outside management teams can "take over" the company.

When there are conflicts among managerial goals in U.S. markets, the most important priority is to ________.

• maintain a safe and happy work place
• foster good relationships with the community
• increase the current market value of equity
• keep all of the company's customers happy

17

Which of the statements below is FALSE?

• An equity claim is a claim to all the assets and cash flows of a company once debt claimants have been paid.
• For common stock, there is no maturity date and the promised cash flow is not stated on the asset, but is determined at a later date by the board of directors.
• Like a bond, common stock entitles the owner to some of the cash flow of a company.
• Bond ownership gives the right to participate in the management of the company.

Which of the following is NOT true regarding the total payment in an equal payment amortization table?

• The final total payment will be greater than the beginning principal for the final period, assuming a positive interest rate.
• The total payment for any period is equal to the principal plus interest payments for that same period.
• All of the above are true.
• The total payment is calculated using the present value of an annuity formula rearranged to solve for the payment.

2

You want to invest in a stock that pays $6.00 annual cash dividends for the next five years. At the end of the five years, you will sell the stock for $30.00. If you want to earn 10% on this investment, what is a fair price for this stock if you buy it today?

• $41.37
• $40.37
• $18.63
• $22.75

Which of the statements below is FALSE?

• When cross rates are out of line, there can be an arbitrage opportunity.
• Exchange rates vary from one day to the next.
• The opportunity to make a profit without risk by exchanging three currencies is known as triple arbitrage.
• Even if you could not do a direct exchange between pounds and yen, you could convert pounds to dollars and then dollars to yen and ultimately end up changing pounds into yen.

________ provides financial advice, helps design bond terms, makes sure that new bonds meet listing requirements, and then markets new bond issues.

• The Securities and Exchange Commission
• The Federal Reserve
• A stock broker
• An investment banker

Dweller, Inc. is considering a four-year project that has an initial after-tax outlay or after-tax cost of $80,000. The future cash inflows from its project are $40,000, $40,000, $30,000 and $30,000 for years 1, 2, 3 and 4, respectively. Dweller uses the net present value method and has a discount rate of 12%. Will Dweller accept the project?

• Dweller accepts the project because the NPV is greater than $30,000.
• Dweller accepts the project because it has a positive NPV of over $28,000.
• Dweller rejects the project because the NPV is less than -$4,000.
• Dweller rejects the project because the NPV is -$3,021.

Can you please help me?