Which one of the following is TRUE?

Select one:

a.For tax, legal and accounting purposes, preference shares are treated as equity.

b.Preference shareholders stand behind ordinary shareholders in line for dividends.

c.Like debtholders, preference shareholders can force a firm into bankruptcy.

d.The previously unpaid dividends for non-cumulative preference shares cannot be skipped.

Clear my choice

Question11

An annuity pays $12 per year for 100 years. What is the future value of this annuity at the end of those 100 years, given that the discount rate is 6%?

Select one:

a.$67,660.42

b.$148,579.94

c.$329,814.19

d.$199.41

Clear my choice

Question12

A linear regression was done to estimate the relation between Santos' share returns and the market's return. The intercept of the line was found to be 0.23 and the slope was 1.27. Which of the following statements is TRUE regarding Santos shares?

Select one:

a.The standard deviation of Santos' excess returns is 23%.

b.Santos' beta is 0.23.

c.Santos' beta is 1.27.

d.The risk-free rate is 1.27%.