Which of the following capital budgeting techniques does not adjust for the riskiness of the cash flow

-IRR

-NPV

-MIRR

-Payback

_____ projects are a set of projects where the acceptance of one project means that other projects cannot be accepted

-Mutually exclusive

-Independent

-Replacement

-Expansion

Which of the following methods calculating an average beta for firms in a similar business and then applying that beta to determine the beta of its own project

-risk premium method

-pure play method

-accounting beta method

-CAPM method

Your uncle would like to restrict his interest rate risk and his default risk, but he still would like to invest in corporate bonds. Which of the possible bonds listed below best satisfies your uncle's criteria

-AA bond with 10 years to maturity

-BBB perpetual bond

-BBB bond with 10 years to maturity

-AAA bond with 5 years to maturity

Which of the following statements is most correct? Other things held constant, _____

-the "liquidity preference theory'' would generally lead to an upward sloping yield curve

-the ''market segmentation theory'' would generally lead to an upward sloping yield curve

-the "expectations theory" would generally lead to an upward sloping yield curve

-the yield curve under "normal" conditions should be horizontal

When a project's NPV exceed zero, _____

-the project will also be acceptable using payback criteria

-the IRR should be calculated to insure that the project's projected rate of return exceeds the required rate of return

-the project may be accepted without any further consideration, assuming we are confident that the cash flows and the required rate of return have been properly estimated

-the project's hurdle rate must exceed its IRR

Which of the following is NOT a source of equity on a firm's balance sheet

-additional paid-in capital

-retained earnings

-common stock

-property, plant, and equipment

Which of the following is not generally considered to be an advantage of term loans over publicly issued bonds

-lower flotation (issuance) costs

-speed, or how long it takes to bring the issue to market

-liquidity, or how easily investors can trade them in the secondary markets

-flexibility, or the ability to adjust the bond's terms after it has been issued

The preemptive right is important to shareholders because it

-allows management to sell additional shares below the current market price

-protects the current shareholders against dilution of ownership interests

-is included in every corporate charter

-will result in higher dividends per share

The sustainable growth model gives managers a kind of shorthand projection that ties together _____ and ______

-growth objectives; finacial needs

-external funds required; strategic plan

-growth objectives; cash receipts

-the cash budget; strategic plan

Most pro forma statements begin with a sales forecast. One approach to deriving a sales forecast is top-down approach. Top-down sales forecasts rely heavily on ____

-macroeconomic and industry forecasts

-customer input

-forecasts from the sales force

-Board of Directors input