FIN 370 Week 4 Apply Risk and the Cost of Capital Homework

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24.3 percent

Which of the following are the stocks of small companies that are priced below $1 per share? Multiple Choice • Penny stocks • Hedge fund stocks • Stock market bubble stocks • Bargain stocks

A company has a beta of 0.50. If the market return is expected to be 12 percent and the risk-free rate is 5 percent, what is the company's required return? Multiple Choice • 6.0 percent • 11.0 percent • 13.5 percent • 8.5 percent

If the Japanese stock market bubble peaked at 37,500, and two and a half years later it had fallen to 25,900, what was the percentage decline? Multiple Choice • −30.93 percent • −69.07 percent • −27.63 percent • −10.31 percent

A company's current stock price is $84.50 and it is likely to pay a $3.50 dividend next year. Since analysts estimate the company will have a 10 percent growth rate, what is its expected return? Multiple Choice


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