The capital structure weights used in computing the weighted average cost of capital: a) are based on the values of total debt and total equity b are based on the market value of the firm's debt and equity securities c) are computed using the book value of the long-term debt and the book value of equity d) remain constant over time unless the firm issues new securities e) depend on the firm's tax rate You purchased a share of stock at $59.00. One year later, after having received a dividend of $2.00, you noted the stock price was $68.00. What is your approximate "return" on this stock for the year? a) 2.0% b) 3.4% c) 8.6% d) 15.3% e) 18.6% It is often said that you can reduce your investment risk by creating a portfolio of stocks rather than investing in a single stock. This concept is referred to as diversification. Diversification significantly reduces some component of the total risk (also referred to as diversifiable risk). What is the name of the basic risk concept that we can reduce through diversification? a) Systematic (market) risk b) Non-systematic (unique) risk c) Interest rate risk d) Labor risk e) Foreign exchange risk The stock of Keif Corp has an expected return of 15% and Fireball Corp has an expected return 20%. If you put 40% of your money in Keif and 60% in Fireball, what is your of expected return for your portfolio? a) 15.9% b) 17.2% c) 18.0%. d) 19.1% e) 52.6%