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Fin 571 Final Exam 3

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Fin 571 Final Exam 3
FIN 571 FINAL EXAM 3

http://www.finalexamguideline.com/FIN-571-FINAL-EXAM-3-53.htm

1) Whenever a firm splits itself into separate units, with each unit having limited liability with respect to its financing, the capital structure of each unit becomes __________

2) An investor's risky portfolio is made up of individual stocks. Which of the following statements about this portfolio is true?

3) An all-equity-financed firm would __________.

4) The capital budgeting process can be broken down into five steps. These steps include which of the following?

5) Projects can be classified into various categories. These include:

6) Boeing Corporation is a world leader in commercial aircraft. In the face of competition, Boeing often faces a critical decision: whether to develop a new generation of passenger aircraft.

7) A firm cannot simply adopt the industry average debt ratio, because differences exist among firms in any particular industry with respect to __________.

8) Studies show systematic differences in capital structures across industries. These are due mostly to differences in __________.

9) Studies show systematic differences in capital structures across industries. These are due mostly to differences in the availability of tax shelter provided by things other than debt, such as __________.

10) Preferred stock payment obligations are typically

11) If the yield to maturity for a bond is less than the bond's coupon rate, then the market value of the bond is __________.

12) Assume that the par value of a bond is $1,000. Consider a bond where the coupon rate is 9% and the current yield is 10%. Which of the following statements is true?

13) Certain countries have restrictions. In practice, U.S. investors have NOT invested very much internationally. Possible factors include __________.

14) Certain countries have restrictions. In practice, U.S. investors have NOT invested very much internationally. Possible factors

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