Which of the two statements below are correct? You can only mark two alternatives and you will get 2 point for each correct answer.

• In a perfect market, the Present Value of a Lease is equal to the Purchase Price minus the Present Value of any Residual Value
• You may never obtain ownership of an asset that you have leased
• To evaluate the leasing decision for a true tax lease, you should compare the cost of leasing with the cost of financing using an equivalent amount of leverage (a lease-equivalent loan)
• The lessee is the owner of the asset, who is entitled to the lease payments in exchange for lending the asset
• Capital preservation is a valid argument for leasing

Which of the two statements below are correct? You can only mark two alternatives and you will get 2 point for each correct answer.

• Systematic risk can not be diversified
• Volatility is a measure of the risk of a stock
• The volatility of a stock is the same thing as the variance of a stock
• The risk of an investment is not related to the expected return of the investment
• A risk-averse investor will avoid investing in stocks

Which of the two statements below are correct? You can only mark two alternatives and you will get 2 point for each correct answer.

• The process of selling stock to the public for the first time is called a seasoned equity offering (SEO)
• Angel Investors typically invest in start-up firms in early stages
• The shares that are sold in an IPO can be either be new shares (secondary offering) or existing shares (primary offering), or both.
• That IPOs are consistently overpriced is a puzzle
• The winners curse refers to the fact that you "win" most IPOs (get the number of shares that you want).

Which of the two statements below are correct? You can only mark two alternatives and you will get 2 point for each correct answer.

• A captured board is a board that has been forced to follow the voting of the shareholders
• Paying managers with stocks and options are a common way of aligning the manager's interest with the firm's.
• The agency problem describes the difficulty of hiring competent managers
• A firm is only monitored by the board of directors.
• An gray director of a board can have potential business relationships with the firm

Which of the two statements below are correct? You can only mark two alternatives and you will get 2 point for each correct answer.

• The IRR is the rate where a project's NPV is equal to zero
• When faced with a set of alternatives, choose the one with the highest NPV.
• The Profitability Index can be used with any number of resource constraints
• When the NPV and the IRR disagrees, you should always base your decision on the IRR
• The IRR investment rule states that you should turn down any investment opportunity that has an IRR that is less than the opportunity cost of capital