BUS 401 Week 4 Quiz Version c

 This pack of BUS 401 Week 4 Quiz Version c consists of:


 1. Operating leverage refers to ________

 2. A firm that uses large amounts of debt financing in an industry characterized by a high degree of business risk would have ______ earnings per share fluctuations resulting from changes in levels of sales.

 3. JB Corporation has a retained earnings balance of $1,000,000. The company reported net income of $200,000, sales of $2,000,000, and had 100,000 shares of common stock outstanding. The company announced a dividend of $ 1 per share. Therefore, the company

Business - General Business
 1.



 Question :



 Investors will make an investment if:















 Student Answer:





 the historical rate of return exceeds the expected rate of return.











 the required rate of return exceeds the expected rate of return.











 the expected rate of return exceeds the actual rate of return.













 the expected rate of return exceeds the required rate of return.







 Instructor Explanation:



 The answer can be found in Section 9.1: The Building Blocks of the Required Return.























 Points Received:



 1 of 1







 Comments:























 2.



 Question :



 Which of the following is true regarding market risk?















 Student Answer:





 It is measured by beta.











 It is also called nondiversifiable risk.











 It is also called systematic risk.













 all of the above







 Instructor Explanation:



 The answer can be found in Section 9.2: Risk and Return.























 Points Received:



 1 of 1







 Comments:























 3.



 Question :



 Which of the following statements regarding the cost of equity is true?















 Student Answer:







 It can be estimated in three different ways.











 It is always estimated using the present value of future dividends approach.











 It is estimated by solving for the discount rate for a perpetuity.











 It is generally lower than the cost of debt because equity holders are paid after taxes are paid.







 Instructor Explanation:



 The answer can be found in Section 10.2: The Weighted Cost of Capital.























 Points Received:



 1 of 1







 Comments:























 4.



 Question :



 The weighted average cost of capital is:















 Student Answer:





 the average return for the company’s stock over the past several years.











 the average cost, including commissions, for raising capital for the firm.













 an average required return for each of the sources of capital used by the firm to finance its projects, weighted by the amount contributed by each source.


To get more course tutorials visit - https://bitly.com/12BGLSZ

Get plenty of sleep. It may be tempting to stay up all night "cramming" for exams, but this is not a good idea. It's been proven that students who get the proper amount of sleep do better on exams. This is because they are more alert and attentive when taking tests.