Finance Exam Key

Exam3 FIN370 Winter 2009 Key

Version B

1. One year ago, you purchased 200 shares of stock for $29 a share. The stock pays $.60 a share in dividends each year. Today, you sold your shares for $31.60 a share. What is your total dollar return on this investment? 

a. $480

b. $670

c. $610

D. $640

e. $520

BLOOMS TAXONOMY QUESTION TYPE: APPLICATION

LEARNING OBJECTIVE NUMBER: 1

LEVEL OF DIFFICULTY: BASIC

Ross - Chapter 010 #44

SECTION: 10.1

TOPIC: DOLLAR RETURN

TYPE: PROBLEMS

2. The amount of systematic risk present in a particular risky asset relative to that in an average risky asset is called the: 

a. mean.

B. beta coefficient.

c. risk premium.

d. standard deviation.

e. variance.

BLOOMS TAXONOMY QUESTION TYPE: KNOWLEDGE

LEARNING OBJECTIVE NUMBER: 3

LEVEL OF DIFFICULTY: BASIC

Ross - Chapter 011 #8

SECTION: 11.6

TOPIC: BETA COEFFICIENT

TYPE: DEFINITIONS

3. Huckster's is reviewing its current accounts to determine how a proposed project might affect the account balances. The firm estimates the project will initially require $86,000 in current assets and $69,000 in additional current liabilities. The firm also estimates the project will require an additional $9,000 a year in current assets for each one of the five years of the project. How much net working capital will the firm recoup at the end of the project assuming that all net working capital can be recaptured? 

a. [pic]$62,000

b. $17,000

C. $62,000

d. $28,000

e. [pic]$17,000

BLOOMS TAXONOMY QUESTION TYPE: APPLICATION

LEARNING OBJECTIVE NUMBER: 2

LEVEL OF DIFFICULTY: BASIC

Ross - Chapter 009 #55

SECTION: 9.2

TOPIC: NET WORKING CAPITAL

TYPE: PROBLEMS

4. The return on a risky asset that is anticipated in the future is called the: 

a. real return.

b. risk premium.

c. systematic return.

D. expected return.

e. beta.

BLOOMS TAXONOMY QUESTION TYPE: KNOWLEDGE

LEARNING OBJECTIVE NUMBER: 1

LEVEL OF DIFFICULTY: BASIC

Ross - Chapter...