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Question:41
$ [) m- ~5 P& pThere are at least four factors that contribute to a firm’s profitability and pricing decisions. All of the following are factors that firms consider when establishing their pricing practices EXCEPT:/ w0 r5 y# M1 S4 n8 ~
A)product segmentation.. [* { `; K: c0 `
B)ease of entry into the industry.
4 S7 s" i2 W6 r! B( s( l. W$ m5 n$ pC)degree of industry concentration.
6 A# h1 y$ a, ZD)product demographics.: E7 S' A q& }
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Question:42
* T& u5 T9 _3 ~0 z; ]6 P/ YJax, Inc., pays a current dividend of $0.52 and is projected to grow at 12 percent. If the required rate of return is 11 percent, what is the current value based on the Gordon growth model?; E& h/ D% v: I( @# P1 @. I
A)$39.47.( ]3 l/ L5 t* J6 ]
B)unable to determine value using Gordon model.2 e9 y s- s/ U/ Z
C)$53.32.
* m' A! {/ Y. c: n) UD)$58.24.
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" _. C& |7 S% d0 A Q% R" g- N2 v' m6 J6 k6 y
Question:43 & t7 ]3 X2 ~; \3 h! K4 D
The difference between free cash flow to equity (FCFE) and free cash flow to the firm (FCFF) is:6 f" V8 q6 Y& a: z3 U
A)earnings before interest and taxes (EBIT) less taxes.
. F& i. i2 n' F" I1 tB)after-tax interest and net borrowing.) M! y, ]! D& g* c) @# p
C)before-tax interest and net borrowing.# i2 A; m0 u3 U5 x
D)capital expenditures.
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Question:44! Y6 R: B- Y1 f4 ]: C8 k
Good Sports, Inc., (GSI) has a leading price to earnings (P/E) ratio of 12.75 and a 5-year consensus growth rate forecast of 8.50 percent. What is the firm’s P/E to growth (PEG) ratio?
6 @3 r! u5 e" @. YA)0.67.
5 [& B* i2 v9 KB)150.00.
/ \0 X6 \. k3 |C)6.67.
+ ` s( a5 h3 i- b- pD)1.50.
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}. n4 M& ^- `* S: yQuestion:45
: c- t# }, p- TA method commonly used to normalize earnings is the method of:1 t1 M9 W) c/ [: [' x
A)average return on assets.
+ t% Z$ N/ ?+ g0 D* TB)historical average earnings per share (EPS).
. b2 t$ x; z! l% K* ^) G; oC)comparables.
( _) A2 J* Z" D7 YD)forecasted fundamentals.
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