the current value of an investment us supposed to be the present value of all expected future cash flows, it is true or false

Name: Student LD.: MG-670 151 10. The current value of an investment is supposed to be the present value of all expected future cash flows a. True b. False 11. Unlimited liability means that the owner of a firm is responsible for paying all the bills of the firm in the event of a bankruptcy a. True b. False 12. The common shareholders of a company have: a. Unlimited liability b. Limited liability 13. Jane Thorpe has been offered a seven-year bond issued by Barone, Inc, for a price of S943.22. The bond has a coupon rate of 9 percent and pays the coupon semiannually. Similar bonds in the market have a yield to maturity of 10 percent today. Should she buy the bonds at the offered price? 14. Cortez, Inc., is expecting to pay out a dividend of $2.50 next year. After that it expects its dividend to grow at 7 percent for the next four years. What is the present value of dividends over the next five-year period if the required rate of return is 10 percent? Round final answer to two decimal places. a. $10.76 b. $11.88 c. $11.50 d. $9.80 15. Next year, Pepsi will pay a dividend of $3.00. It expects to increase its dividend by s0.25 in each of the following three years. If their required rate of return is 14 percent, what is the present value of their dividends over the next four years? Round final answer to two decimal places.) a. $13.50 b. $9.72 c. $12.50 d. $11.63 16. Blockbuster Video has not paid out any dividend in the last three years. It does not expect to pay dividends in the next two years either as it recovers from an economic slowdown. Three years from now it expects to pay a dividend of $2.50 and then $3.00 in the following two