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Question:41
' O) a9 w. J, O& _" l0 @There 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:) k" z1 W+ x- J6 M3 B q6 m; G
A)product segmentation.$ ~" s* O3 C, ^" P1 I5 ?
B)ease of entry into the industry.
* z4 Z8 ], F% ^C)degree of industry concentration.( e! L: g' |0 W' ^' T
D)product demographics.
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Question:42
* `1 n z2 a! ?& h9 ]) |+ oJax, Inc., pays a current dividend of $0.52 and is projected to grow at 12 percent. If the required rate of return is 11 percent, what is the current value based on the Gordon growth model?$ F1 L4 I0 f' [8 C" k5 p& |
A)$39.47.
5 P" K3 |+ {. D5 ^B)unable to determine value using Gordon model.
. O) L1 R$ e4 N$ xC)$53.32.9 ]. q+ V6 Q3 o0 G
D)$58.24.
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, R) M" ^1 |- t! p# f y, ~Question:43 $ e) U% k2 e! l. ~' U
The difference between free cash flow to equity (FCFE) and free cash flow to the firm (FCFF) is:
/ @; |; e& }9 {) MA)earnings before interest and taxes (EBIT) less taxes.8 h) v: N, C/ s. B( Y
B)after-tax interest and net borrowing.
7 c: w3 D2 t3 u) p4 J9 eC)before-tax interest and net borrowing.
3 a }; G' w/ G4 k/ E+ VD)capital expenditures.
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4 Y$ V7 p, A$ w/ aQuestion:44' a$ [& P; q; r w+ K+ E
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 G2 }: i/ C' c8 Q1 X# T6 [
A)0.67.
+ i1 F" Y$ b3 }4 b1 XB)150.00.
# L( P# f" S }! zC)6.67.
% _8 ]% s" u; k: c& UD)1.50.! G( r7 O k/ r7 w5 e/ ?3 C
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Question:45- [0 h& ]/ N7 J5 z6 ?3 e3 q) j
A method commonly used to normalize earnings is the method of:5 k8 l7 B4 T4 [* W/ @
A)average return on assets.
5 t- }5 r2 E- o& k' M* R3 mB)historical average earnings per share (EPS).
u; ]6 E2 A/ a, a9 X' i; A& Z; b7 rC)comparables.
1 X/ A. O. J8 L/ ID)forecasted fundamentals.
' A: {# H( R; _1 A& u+ v/ l N7 i$ @! T7 k
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