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Question:41 1 e6 A0 y8 y+ d4 C: e. u
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:, k5 n2 S+ {- Z# |
A)product segmentation.
6 [ V i9 ]" H( r. L3 ?2 `B)ease of entry into the industry.
9 H. g! V0 x7 l% \$ _C)degree of industry concentration.. ?9 g! |) u& \8 n/ z
D)product demographics.7 C( Y6 z$ O* H
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Question:42 ! F( r) T0 n6 J; K
Jax, Inc., pays a current dividend of $0.52 and is projected to grow at 12 percent. If the required rate of return is 11 percent, what is the current value based on the Gordon growth model?% x$ K5 w1 P& m8 R
A)$39.47.) @* ~, W) n0 | y
B)unable to determine value using Gordon model.
X" J5 y* Q+ H2 V% D( Q4 UC)$53.32.- a/ r3 X5 l* k/ n6 m
D)$58.24.
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Question:43
# J" M2 A8 s5 ]: q9 k# R9 b7 OThe difference between free cash flow to equity (FCFE) and free cash flow to the firm (FCFF) is:
# x. R$ L9 A( ?! D0 [A)earnings before interest and taxes (EBIT) less taxes.' ?* f- r2 `) L% `4 k+ y
B)after-tax interest and net borrowing.' h' ~% u5 k6 S/ z, L
C)before-tax interest and net borrowing.
1 L7 G- x; V" `' h3 |$ tD)capital expenditures.1 c4 \7 M2 V2 w5 L3 Z
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Question:44, x/ F( I; h; f; R0 Q* n: F7 U
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?8 K9 W3 l+ _: U& E
A)0.67.
. O4 Q1 [# M' P$ l" O' IB)150.00.% g3 w* _$ y! D& d, ~. F
C)6.67.
6 Y6 q9 }% k$ I9 }+ q! TD)1.50.4 e0 N- {1 X$ i. W! r2 Q J
( K6 r" _, A# y$ i5 C7 mQuestion:45
- o' V) @; K7 k' ]0 }A method commonly used to normalize earnings is the method of:
' K: I6 [8 K4 Z, Y) \( A2 L5 J% eA)average return on assets.
# k; J0 q; J/ }B)historical average earnings per share (EPS).8 l% ^: i5 [: _' U
C)comparables.3 ]0 s/ f5 [: q' ]5 y2 y
D)forecasted fundamentals.
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