If you find an investment that is an on Buy Quickly and count your l y high you should C ory from the investment because the role that the Cot of you thonda r e to buyon much 9. The total vold on an investment can be computed by dividing Te do return by the beginning price the door return by the ending price c. The change in price by the ending price d. The annual dividend by the beginning price. The change in price by the beginning price, 10. When there is an additional investment later in the life of the project You lonor it for capital ovaluation purpo You discount and counts on a negative in the NPV method You discount and add it in the numattor in the method You discount and add in with the incomes You add it to the initial investment without discountingit 11. Courtney and Aron are having a discussion about market officiency. Courtney says that only pest prices of a stock are included in the current price, and Aron says that only all PUBLC information is reflected. Which of the following is correct a Aron believes in weak form efficiency b. Courtney believes in strong form efficiency. c. Aron and Courtney both believe in semi-strong form officiency d. Aron and Courtney both believe in strong form efficiency e Aron beves in semi-strong form efficiency. 12. When the president of the United States goes in for his/her annual medical checkup the stock market dios a few points. This is an example of which of the following statements L Prices respond quickly to information 1. Future prices are difficult to predict based on publicly available information M. I mispriced stocks do exist, there is no easy way to identify them. a. Tonly b. Wonly C only d. Tand I only ell and only 13. Conservative Company has a degree of operating leverage of 1.75. The predicted sales level of 20,000 units next year may be way off. Sales may be as much as 22.000 units. If operating cash flow is expected to be $2.000.000 at the lower level, what would you expect OCF to be at the higher sales level a. $2.800,020 b. $2.350,000 c. $1.650.000 d. $350.000 e. $1.880.000 14. Which of the following "what if" analysis methods would be most useful in identifying the vulnerability of th company to changes in the price of gasoline? a financial break-even analysis b. scenario analysis c. simulation analysis d. sensitivity analysis e. cash break-even analysis 8. If you find an investment that is paying an unusually high rate of interest, you should a. Buy it quickly and count yourself lucky. b. Look for the greater than usud amount of risk that is bound to be there C. Stay away from the investment because the rate has to be a mistake. d. Report the matter to the SEC because there has to be something illegal about it. e. Call all your friends and advise them to buy as much of the stock as they can 9. The total yield on an investment can be computed by dividing a. The dollar return by the beginning price. b. the dollar return by the ending price. c. The change in price by the ending price d. The annual dividends by the beginning price. e. The change in price by the beginning price. 10. When there is an additional investment later in the life of the project. a. You ignoro it for capital ovaluation purposes. b. You discount it and count it as a negative in the NPV method. c. You discount it and add it in the numerator in the Pl method. d. You discount it and add it in with the incomes. e. You add it to the initial investment without discounting it. 11. Courtney and Aron are having a discussion about market efficiency, Courtney says that only past prices of a stock are included in the current price, and Aron says that only all PUBLIC information is reflected. Which of the following is correct? a. Aron believes in weak form officiency. b. Courtney believes in strong form efficiency. c. Aron and Courtney both believe in semi-strong form efficiency. d. Aron and Courtney both believe in strong form efficiency. e. Aron believes in semi-strong form officiency. 12. When the president of the United States goes in for his/her annual medical checkup, the stock market dips a few points. This is an example of which of the following statements 1. Prices respond quickly to information II. Future prices are difficult to predict based on publicly available information III. I mispriced stocks do exist, there is no easy way to identify them. a. I only b. Only C. I only d. I and I only e. Il and only 13. Conservative Company has a degree of operating leverage of 1.75. The predicted sales level of 20,000 units next year may be way off. Soles may be as much as 22,000 units. If operating cash flow is expected to be $2.000.000 at the lower level, what would you expect OCF to be at the higher sales level a $2.800,020 b. $2.350,000 c. $1.650.000 d. $350.000 e. $1.880.000 14. Which of the following what ir analysis methods would be most useful in identifying the vulnerability of the company to changes in the price of gasoline? a financial break-even analysis b. scenario analysis c. simulation analysis d. sensitivity analysis e. cash break-even analysis
