Which of the following statements is CORRECT? Group of answer choices The WACC is not related...

Which of the following statements is CORRECT?

Group of answer choices

The WACC is not related to the cost of debt or equity capital

The WACC will be changing for the changing market value of the shares and debentures

The WACC should be the hurdle rate for evaluating all projects

The WACC is the expected rate of return for the market

Expert Solution

jeff jeffy answered 2 years ago

Which of the following statements is correct? Group of answer choices None of these is correct....

Which of the following statements is correct? Group of answer choices None of these is correct. The demand for iPads is more elastic than the demand for tablets in general. Here, iPads is one kind of tablets. The demand for a necessity good is more elastic than the demand for a luxury good. The demand for cell phones is more elastic over a short period of time than over a long period of time

Which of the following statements is CORRECT? Group of answer choices An increase in the DSO,...

Which of the following statements is CORRECT? Group of answer choices An increase in the DSO, other things held constant, could be expected to increase the ROE. An increase in the DSO, other things held constant, could be expected to increase the total assets turnover ratio. If two firms have the same ROA, the firm with the most debt can be expected to have the lower ROE. The ratio of long-term debt to total capital is less likely to experience...

Which of the following statements is correct? Group of answer choices If a project with normal...

Which of the following statements is correct? Group of answer choices If a project with normal cash flows has an IRR greater than the WACC, the project must also have a positive NPV. A project’s MIRR can never exceed its IRR. If Project A’s IRR exceeds Project B’s, then A must have the higher NPV. If the NPV is negative, the IRR must also be negative. If a project with normal cash flows has an IRR less than the WACC,...

Which of the following statements is(are) correct? Group of answer choices Assume that goods A and...

Which of the following statements is(are) correct? Group of answer choices Assume that goods A and B are substitutes. Suppose a technology improvement in the production of good A and an increase in the price of good B. If everything else remains the same, in the market of good A, the equilibrium price decreases but the effect on the equilibrium quantity depends on the magnitudes of the shifts in supply and demand Assume that goods M and N are complements....

Which of the following statements is correct? Group of answer choices One disadvantage of forming a...

Which of the following statements is correct? Group of answer choices One disadvantage of forming a corporation is that equity investors are usually exposed to less liability than they would be in a partnership. Corporations face more regulations than sole proprietorships. One disadvantage of operating a business as a sole proprietor is that the firm is subject to double taxation, because taxes are levied at both the firm level and the owner level. It is generally less expensive to form...

Which of the following statements is correct? Group of answer choices The dividend theory espoused by...

Which of the following statements is correct? Group of answer choices The dividend theory espoused by Modigliani and Miller would say that firms would be better served with a constant pattern of growing dividends. The tax differential dividend theory by Litzenberger and Ramaswamy, would say that firms will be better off to pay a higher amount of dividends because the lower tax rates associated with dividends as compared to capital gains. The bird-in-the-hand theory would say that a higher dividend...

Which of the following statements is CORRECT? Group of answer choices 1) The use of debt...

Which of the following statements is CORRECT? Group of answer choices 1) The use of debt financing will tend to lower the basic earning power ratio, other things held constant. 2) A firm that employs financial leverage will have a higher equity multiplier than an otherwise identical firm that has no debt in its capital structure. 3) If two firms have identical sales, interest rates paid, operating costs, and assets, but differ in the way they are financed, the firm...

1)which are correct of these statements . Group of answer choices: a)If a security is underpriced,...

1)which are correct of these statements . Group of answer choices: a)If a security is underpriced, then the expected holding period return is above the market capitalization rate. b)The value of the equity equals the present value of all future payouts (dividends plus repurchases). c)The value of a share equals the present value of all future dividends per share. d)If a firm reinvests its earnings at an ROE equal to the market capitalization rate, then its earnings-price (E/P) ratio is...

PART 1) Which of the following statements(s) is/are correct? Group of answer choices An weakness of...

PART 1) Which of the following statements(s) is/are correct? Group of answer choices An weakness of SPI is that it does not take into account if the project's critical path is on schedule. It is possible to have a SPI greater than 1.0 while the project is actually behind schedule. An weakness of SPI is that it does not take into account of activites/tasks that have a budgeted cost of zero, such as tasks dealing with submittals and ordering of...

Which of the following statements concerning capital budgeting methods is/are correct? Group of answer choices a....

Which of the following statements concerning capital budgeting methods is/are correct? Group of answer choices a. The IRR and NPV methods may provide conflicting recommendations when choosing independent projects. b. The discounted payback period method discounts accounting earnings at the cost of capital for risky projects. c. The IRR and NPV methods may provide conflicting recommendations when choosing among mutually exclusive projects. d. The pure payback method is the best method for evaluating large scale investment projects because it measures...

Question