DEVRY FIN 515 Final Exam 5 Sets

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DEVRY FIN 515 Final Exam 5 Sets

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• FIN 515 Final Exam 5 Sets
• (TCO A) In the United States, the most common
  type of business by number of businesses is the
  _____. (Points 5)
• (TCO A) Sole proprietorships have all of the
  following advantages except (Points 5)
• (TCO B) Which of the following would cause the
  future value of an annuity to decrease? (Points
  5)
• (TCO B) Which of the following is an annuity due?
  (Points 5)
• (TCO G) What are the names of the four components
  of the DuPont Identity and how are they
  calculated? What does each measure? (Points 20)
• (TCO D) A stock pays an annual dividend of 2.50
  and that dividend is not expected to change.
  Similar stocks pay a return of 10. What is P0?
  (Points 20)

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• (TCO D) A particular bond has 8 years to
  maturity. It has a face value of 1,000. It has a
  YTM of 7 and the coupons are paid semiannually
  at a 10 annual rate. What does the bond
  currently sell for? (Points 10)
• (TCO D) A bond currently sells for 1,000 and has
  a par of 1,000. It was issued two years ago and
  had a maturity of 10 years. The coupon rate is 7
  and the interest payments are made semiannually.
  What is its YTM? (Points 10)
• (TCO D) Using examples, explain the difference
  between systematic risk and nonsystematic risk.
  Explain why the distinction is important for both
  investors and issuers of stock.(Points 30)
• (TCO E) A company has 10 million shares
  outstanding trading for 7 per share. It also has
  300 million in outstanding debt. If its equity
  cost of capital is 15, and its debt cost of
  capital is 9, and its effective corporate tax
  rate is 40, what is its weighted average cost of
  capital? (Points 30)
• (TCO A) Relate how the job of the financial
  manager can be explained using the balance sheet.
  (Points 25)
• (TCO H) Other things being equal, would a firm
  prefer a longer or shorter Cash Conversion Cycle?
  What are some examples of ways a firm could
  attain this? (Points 30)
• (TCO F) A company has the opportunity to do any
  of the projects for which the net cash flows per
  year are shown below. The company has a cost of
  capital of 12. Which should the company do and
  why? You must use at least two capital budgeting
  methods. Show your work