Finance Quiz

Which one of the following is defined as a firm's short-term assets (Tài sản ngắn hạn) and its short-term liabilities (Nợ ngắn hạn)?

• Working capital : Vốn lưu động

• Debt

• Investment capital

• Net capital

• Capital structure

Which one of the following is an agency cost (Chi phí đại lý)?

• Accepting an investment opportunity that will add value to the firm

• Increasing the quarter dividend

• Investing in a new project that creates firm value

• Hiring outside accountants to audit the company's financial statements.

• Closing a division of the firm that is operating at a loss

Shareholders' equity

• Increases in value anytime total assets increases

• Is equal to total assets plus total liabilities

• Decreases whenever new shares of stock are issued

• Includes long-term debt, preferred stock, and common stock

• Represents the residual value of the firm.

Interest earned on both the initial principal and the interest reinvested from prior periods is called:

• Free interest

• Dual interest

• Simple interest

• Interest on interest

• Compound interest

All else constant, a bond will sell at…… when the coupon rate is the yield to maturity

• A premium…less than

• A premium…equal to

• A discount…less than

• A discount…higher than

• Par…less than

The current yield is defined as the annual interest on a bond divided by which one of the following?

• Coupon

• Face value

• Market price

• Call price

• Dirty price

Which one of the following statements is correct?

• The capital gains yield is the annual rate of change in a stock's price

• Preferred stocks have constant growth dividends

• A constant dividend stock cannot be valued using the dividend growth model

• The dividend growth model can be used to compute the current value of any stock.

• An increase in the required return will decrease the capital gains yield.

The present value of an investment's future cash flows divided by the initial cost of the investment is called

• Net present value

• Internal rate of return

• Average accounting return

• Profitability index

• Profile period

Which one of the following will decrease the net present value of a project?

• Increasing the value of each of the project's discounted cash inlows

• Moving each of the cash inflows forward to a sooner time period

• Decreasing the required discount rate

• Increasing the projects initial cost at time zero

• Increasing the amount of the final cash flow

If a project has a net present value equal to zero, then:

• The total of the cash inflows must equal the initial cost of the project

• the project earns a return exactly equal to the discount rate

• A decrease in the projecéc initial cost will cause the project to have a negative NPV.

• Any delay in receiving the projected cash inflows will cause the project to have a positive NPV

• The project's PI must be also be equal to zero