Which of the following yields on a stock can be negative?

Dividend yield

Capital gains yield

Capital gains yield and total return

Dividend, capital gains, and total return

Dividend yield and total return

The capital asset pricing model approach to equity valuation:

Is dependent upon the unsystematic risk of a security.

Assumes the reward-to-risk ratio increases as beta increases.

Can only be applied to dividend-paying firms.

Assumes a firms future risks will be higher than its current risks.

Assumes the reward-to-risk ratio is constant.

The weighted average cost of capital for a firm can depend on all of the following except the:

Firms beta.

Coupon rate of the outstanding bonds.

Growth rate of the firms dividends.

Firms marginal tax rate.

Standard deviation of the firms common stock.

When a firm has flotation costs equal to 6.8 percent of the funding need, project analysts should:

Increase the project's discount rate to offset these expenses by multiplying the firm's WACC by 1.068.

Increase the project's discount rate to offset these expenses by dividing the firm's WACC by (1 - .068).

Add 6.8 percent to the firm's WACC to determine the discount rate for the project.

Increase the initial project cost by multiplying that cost by 1.068.

Increase the initial project cost by dividing that cost by (1 - .068).

During the year, RIT Corp. had sales of $565,600. Costs of goods sold, administrative and selling expenses, and depreciation expenses were $476,000, $58,800, and $42,800, respectively. In addition, the company had an interest expense of $112,000 and a tax rate of 32 percent. What is the operating cash flow for the year? Ignore any tax loss carry-back or carry-forward provisions.

$17,920

$21,840

$30,800

$52,600

$77,840