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Question:41
" v: t: b8 |: }. ^3 uThere 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:
/ F: t8 q9 e" aA)product segmentation. e/ ]7 [$ q3 x7 C! g8 k
B)ease of entry into the industry.
6 R* x" w Y9 p+ `: K. |5 XC)degree of industry concentration.7 ^+ C3 p5 O0 V9 p
D)product demographics.
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Question:42 0 ]3 T+ F: l2 v- U
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?
2 _; {3 r9 M* k6 RA)$39.47.! N7 o! @ x4 F& \& |* t, d g
B)unable to determine value using Gordon model.
! P; ?5 x4 [( J2 I3 k" {- zC)$53.32.4 l; [5 ^: u* @
D)$58.24.$ p9 k. K& u9 N. v3 Q! y6 c
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' b4 G# l0 |* [Question:43 l6 m+ x1 z+ U5 o" R" T
The difference between free cash flow to equity (FCFE) and free cash flow to the firm (FCFF) is:) W) x) o- i: @' o8 s8 ?# o
A)earnings before interest and taxes (EBIT) less taxes.) n9 @8 \6 n7 C- j# k, e/ P
B)after-tax interest and net borrowing.
; d# Q7 N! t( E b( J( FC)before-tax interest and net borrowing.
# b! C' ~- _+ y7 [5 ~; K; s, U! x) oD)capital expenditures.
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Question:44
# y" t* I. N; zGood 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?
7 C1 x) @, j# V; @8 u" SA)0.67.
3 @) G4 }8 I5 T" Z: P2 \' yB)150.00.
3 c/ x4 r5 l+ k, XC)6.67.
7 M( i5 v' ^9 WD)1.50.7 M6 l7 a8 S7 Q) {! |+ F, l
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Question:45# w- v4 n" C& Q
A method commonly used to normalize earnings is the method of:, b U6 ~4 A: Z" [" }4 }
A)average return on assets.- M. v3 V: J8 O# P0 A
B)historical average earnings per share (EPS)., p3 t: D! |+ E. _& }
C)comparables.) b9 N; Y1 Z5 c& c( f3 N" f
D)forecasted fundamentals.
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