Graed quiz BUS 4404 unit 6 PDF

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BUS 4404 - AY2021-T3 4 March - 10 March Graded Quiz Unit 6 Started on Tuesday, 9 March 2021, 6:10 PM State Finished Completed on Tuesday, 9 March 2021, 6:40 PM Time taken 30 mins 2 secs Marks 20/21. Grade 95 out of 100. Question 1CorrectMark 1 out of 1 flaggedFlag question Question text The Alpha Co...

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BUS 4404 - AY2021-T3 4 March - 10 March Graded Quiz Unit 6 Started on State

Tuesday, 9 March 2021, 6:10 PM

Finished

Completed on Tuesday, 9 March 2021, 6:40 PM Time taken

30 mins 2 secs

Marks 20.00/21.00 Grade 95.24 out of 100.00 Question 1CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text The Alpha Company has issued a total of 36,000,000 shares of common stock at par (its value to the firm is $36,000,000. The dividend yield is 6.5%. The company also has $24,000,000 of bonds (also sold at par) with a coupon rate of 5%. The tax rate for Alpha is 30%. What is its weighted average cost of capital (WACC)? Select one: a. 5.00% b. 5.15% c. 5.30% Correct d. 5.65% Feedback The correct answer is: 5.30% Question 2CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text The following is short-term way to hold cash until it is needed: Corporate debentures. Select one: True False Correct Feedback The correct answer is 'False'. Question 3CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text

The accounts receivable and inventory turnover rates remain the same. However a company negotiates with its major supplier of inventory to allow an extra 15 days in which to pay with no finance charge and with no loss of price discount. Select one: a. The company will realize a more efficient cash conversion. Correct b. The company will experience no change in an efficient cash conversion. c. The company will have to wait an extra 15 days to collect on its accounts receivable. d. The company will have to wait more than 15 days to collect on its accounts receivable. Feedback The correct answer is: The company will realize a more efficient cash conversion. Question 4CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text Company ABC has common stock with a per share market value of $27.15 and an annual dividend of $1.62. Company DEF has common stock with a per share market value of $28 and an annual dividend of $1.75. As an investor, which company has the favorable yield? Select one: a. ABC b. DEF Correct Feedback The correct answer is: DEF Question 5CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: US Treasury Notes of 10 year duration. Select one: True False Correct Feedback The correct answer is 'False'. Question 6CorrectMark 1.00 out of 1.00Not flaggedFlag question

Question text True or False: The following is short-term way to hold cash until it is needed: Corporate bond. Select one: True False Correct Feedback The correct answer is 'False'. Question 7CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text As compared to bonds selling at par, the same series of bonds selling at a discount will have yields that are: Select one: a. higher Correct b. the same c. lower d. cannot be determined without the coupon rate Feedback The correct answer is: higher Question 8CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Municipal bonds. Select one: True False Correct Feedback The correct answer is 'False'. Question 9CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text

An investor pays $8,750 for a $10,000 corporate bond with a 4.75% coupon (interest rate). What is the bondholder's yield? Select one: a. 4.79% b. 5.43% Correct c. 5.85% d. 6.00% Feedback The correct answer is: 5.43% Question 10CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Interest bearing demand deposit accounts (DDA). Select one: True Correct False Feedback The correct answer is 'True'. Question 11CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text As compared to bonds selling at par, the same series of bonds selling at a premium will have yields that are: Select one: a. higher b. the same c. lower Correct d. cannot be determined without the coupon rate Feedback The correct answer is: lower Question 12CorrectMark 1.00 out of 1.00Not flaggedFlag question

Question text Company Alpha issued bonds at a discount where each $1,000 face (par) bond was issued for $850. The coupon rate is stated as 5.5%. Company Beta issued its bonds at par (each $1,000 of bond was issued for $1,000) with a coupon rate of 6.25%. As an investor, which company's bonds have the favorable yield?

Select one: a. Alpha Correct b. Beta Feedback The correct answer is: Alpha Question 13CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Money market funds. Select one: True Correct False Feedback The correct answer is 'True'. Question 14CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: US Treasury Bills. Select one: True Correct False Feedback The correct answer is 'True'. Question 15CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text The market value of a common stock decreases in value but the company's management decides to make no change in dividends paid. The current annual dividend yield will:

Select one: a. increase Correct b. remain the same c. decrease d. cannot be determined Feedback The correct answer is: increase Question 16CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Preferred stock. Select one: True False Correct Feedback The correct answer is 'False'. Question 17CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Commercial paper. Select one: True Correct False Feedback The correct answer is 'True'. Question 18CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text Common stock with a current market value of $33.42 per share issues a quarterly dividend of $0.40. What is its current annual dividend yield? Select one: a. 4.79% Correct

b. 5.125% c. 5.25% d. 6.15% e. 1.20% Feedback The correct answer is: 4.79% Question 19CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Common stock. Select one: True False Correct Feedback The correct answer is 'False'. Question 20Not answeredMarked out of 1.00Not flaggedFlag question Question text An investor buys a $10,000 bond at par. The coupon is 5.5%. What is its yield? Select one: a. 4.5% b. 5.5% c. 6.5% d. 7.5% Feedback The correct answer is: 5.5% Question 21CorrectMark 1.00 out of 1.00Not flaggedFlag question Question text True or False: The following is short-term way to hold cash until it is needed: Certificate of deposit of 6 months. Select one:

True Correct False Feedback The correct answer is 'True'...