Post University FIN 201 Final Exam (Solution 50/50) - 77920

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1) At 11 percent interest, how long would it take to quadruple your money?

6.55

6.64

13.09

13.28

13.56

2) Which one of the following will decrease if a firm can decrease its operating costs, all else constant?

Return on equity

Return on assets

Profit margin

Equity multiplier

Price-earnings ratio

3) Chelsea Fashions is expected to pay an annual dividend of \$0.80 a share next year. The market price of the stock is \$22.40 and the growth rate is 5 percent. What is the firm's cost of equity?

7.58 percent

7.91 percent

8.24 percent

8.57 percent

9.00 percent

4) According to the Rule of 72, you can do which one of the following?

Double your money in five years at 7.2 percent interest

Double your money in 7.2 years at 8 percent interest

Double your money in 8 years at 9 percent interest

Triple your money in 7.2 years at 5 percent interest

Triple your money at 10 percent interest in 7.2 years

5) If a firm has a debt-equity ratio of 1.0, then its total debt ratio must be which one of th

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