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When the net present
value is negative, the internal rate of return is __________ the cost of
capital.
Answer
The IRR
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Which one of the
following capital-budgeting evaluation techniques is based on finding a
discount rate which causes the net present value to be zero?
Answer
An examination of a
firm’s opportunities, strengths, threats and weaknesses is often referred to by
the following acronym:
Answer
WOTS.
OSTW.
SWOT.
TWOS.
Capital budgeting is
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The relevant cash
flows of a project do not include which one of the following?
Answer
The stage in the
capital budgeting process in which projects that are accepted must be
executed in a timely fashion is called the _____________ stage.
Answer
The
capital-budgeting process starts with which one of the following stages:
Answer
The corporate
planning tool that develops project plans that fit well with the firm’s plans
is often referred to by the following acronym:
Answer
When the net present
value for a project is negative, the internal rate of return is _________ the
cost of capital.
Answer
Corporate debt as a
percentage of GDP grew from around ______ in 1970 to nearly ______ in 2007.
Answer
The internal and
sustainable growth rate relationships suggest that there are three measurable
influences on growth. These include all of the following except:
Answer
The initial impact
of increasing the use of debt is to:
Answer
Which of the
following is a different concept from the other three?
Answer
When retained
earnings are used up and new common stock is issued, we know that the cost
of:
Answer
The firm’s target
capital structure is consistent with which of the following?
Answer
A firm’s degree of
combined leverage can be measured as degree of operating leverage __________
the degree of financial leverage:
Answer
What should be the
relation between the target capital structure for a firm and the firm’s
optimum capital structure?
Answer
The cost of debt:
Answer
Of the components
shown below, which is least likely to be of value in calculating the cost of
preferred stock?
Answer
