Which capital structure should provide the lowest Weighted Average Cost of Capital?

Select an answer:

• 100% debt

• 90% debt, 90% equity

• 100% equity

• 50% debt, 50% equity

Which statement is correct about bonds but NOT about stocks?

Select an answer:

• Bond holders have the lowest priority in the case of bankruptcy.

• Payment amounts to the investor are fixed.

• Payments to the investor are optional.

You have been added as a member to a publicly traded company's board of directors. What is meant by the "fiduciary duty" you now have?

Select an answer:

• using your experience to make the most beneficial investments with company funds

• directing the company in ways that will maximize shareholder value

• placing your personal investments into the company on whose board you sit

• determining the market in which company shares are sold