Finance homework questions help

[dynacraze]

Studying for finance final now and am cramming. Anyone here can help me in these multiple choice questions review for my final?

1. Savings are transferred to business firms by which of the follwing methods

a. Direct transfer of funds
b. Indirect transfer using the investment banker
c. Indirect transfer using the financial intermediary
d. All of the above

2. Assume that a 10-year Treasury bond has a 12 percent annual coupon, while a 15-year Treasury bond has an 8 percent annual coupon. The yield curve is flat; all Treasury securities have a 10 percent yield to maturity. Which of the following statments is most correct?

a. 10 year bond is selling at a discount, while the 15 year bond is selling at a premium
b. 10 year bond is selling at a premium, while the 15 year bond is selling at par
c. If interest rates decline, the price of both bonds will increase, but the 15-year bond will have a larger percentage increase in price.
d. If the yield to maturity on both bonds remains at 10 percent voer the next year, the price of the 10 year bond will increase, but the price of the 15 year bond will fall
e. C and D are correct

3. Stock X and Stock Y sell for the same price in today's market. Stock X has a required return of 12 percent. Stock Y has a required return of 10 percent. Stock X's dividend is expected to grow at a constant rate of 6 percnet a year, while Stock Y's divident is expected to grow at a constant rate of 4 percent. Assume that the market is in equilibriium and expected returns equal required returns. Which of the following statmetns is most correct?

a. Stock X has a higher dividend yield than stock Y
b. Stock Y has a higher dividend yield than Stock X
c. One year from now, Stock X's price is expected to be higher than Stocky Y's price
d. A and C are correct
e. B and C are correct.

4. Which of the following statments is most correct?
a. Higher flotation costs reduce investor returns, and therefore reduce a company's WACC
b. WACC represents the historical cost of capital and is usually calculated on a before-tax basis
c. The cost of retained earnigns is zero b/c retained earnings are readily available and do not require the payment of flotation costs.
d. All of above
e. None of above

The answers i came up with are
1. D
2. E
3. No idea
4. A

Anyone can confirm or disconfirm my answers? That would be a lot of help. Thanks. Currently hating finance [img]/images/graemlins/frown.gif[/img]

[NajdorfDefense]

Can we lock these incredibly annoying threads, mods? Tks.

Dude, stop cheating and learn something.

If you have no idea for 3, you should really switch majors.

[dynacraze]

okay. Finance isn't my major. It's just a required class. I am leaning more heavily to C for question 3.

[Esection]

[ QUOTE ]
Dude, stop cheating and learn something.


[/ QUOTE ]

dont be an @ss. i see no cheating here. OP is asking for help, and if you want to flame so badly go to bbv.

OP 1 and 2 look okay.

for 3 you should be able to find an equation in your text to solve that. key word there is dividend yield. and remember you have to discount the cashflows.

4 im not sure on.

[dynacraze]

Yea, for 3 i doublechecked and saw that C is the most logical answer

[ahnuld]

ok, ill be honest. I get really pissed off about these homework threads too. I feel the OP should STFU and read the textbook because these are [censored] easy questions. But as a mod im not goin to lock a thread because I dont like it. Im only going to lock it is it pisses alot of the regular F&I posters off. Iv asked this before though and noone but me minded. Now its clear that Naj hates this stuff too. So if others find this clutter annoying in this forum, speak now or forever hold your peace.

[BennettBrauer]

[ QUOTE ]
ok, ill be honest. I get really pissed off about these homework threads too. I feel the OP should STFU and read the textbook because these are [censored] easy questions. But as a mod im not goin to lock a thread because I dont like it. Im only going to lock it is it pisses alot of the regular F&I posters off. Iv asked this before though and noone but me minded. Now its clear that Naj hates this stuff too. So if others find this clutter annoying in this forum, speak now or forever hold your peace.

[/ QUOTE ]

Annoying, lock and or delete thread. It adds nothing to the forums, and is simply a way to get others to do your work, imho.

People on the strat forums don't go around posting all the questions in Harrington's book, or every endgame in Benko's endgame texts on POG, etc.

It's one thing to ask, "Why is the equity premium x%" because then all can have a discussion about it - some may say it should be zero, others 10, whatever. It's learning for most here.

Posts like the OP are just inane. Read the freakin' textbook, kid. Go to class. Ask a classmate. Ask the teacher. Get a tutor. Ask an upperclassman.

[Perplexity]

Also the previous post he made here was answerable in <15 seconds of Googling.

[edtost]

[ QUOTE ]
[ QUOTE ]
ok, ill be honest. I get really pissed off about these homework threads too. I feel the OP should STFU and read the textbook because these are [censored] easy questions. But as a mod im not goin to lock a thread because I dont like it. Im only going to lock it is it pisses alot of the regular F&I posters off. Iv asked this before though and noone but me minded. Now its clear that Naj hates this stuff too. So if others find this clutter annoying in this forum, speak now or forever hold your peace.

[/ QUOTE ]

Annoying, lock and or delete thread. It adds nothing to the forums, and is simply a way to get others to do your work, imho.

People on the strat forums don't go around posting all the questions in Harrington's book, or every endgame in Benko's endgame texts on POG, etc.

It's one thing to ask, "Why is the equity premium x%" because then all can have a discussion about it - some may say it should be zero, others 10, whatever. It's learning for most here.

Posts like the OP are just inane. Read the freakin' textbook, kid. Go to class. Ask a classmate. Ask the teacher. Get a tutor. Ask an upperclassman.

[/ QUOTE ]

well said.

[Evan]

Ahnuld and I decided we'll be locking threads like this. The basic rule, as it's always been on 2+2, is that you shouldn't use the forums as a replacement for Google. Threads are meant to foster discussion, not achieve one off answers.

If you post a homework question that is interesting and thought provoking that's fine. As a rule of thumb though, multiple choice questions are rarely going to qualify.