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Q: How is preferred stock similar to long-term debt? How is it comparable to equity?
A: The Answer :
Q: Define Rate of return on stock investment.
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Q: long-term debt, preferred stock, and commercial paper
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A:
Q: Is preferred stock comparable to long-term debt in any way? Is it comparable to equity in any way?
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Q: Is Preferred stock a hybrid between common stock and debt? Explain how?
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Q: How does preferred stock compare to long-term debt? In what respects is this comparable to equity?
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Q: How does one calculate the capital gains yield and the dividendyield of a stock?
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- The capital asset pricing model expresses the cost of equity as a function of a return on riskless assets, a market premium, and: Select one:a. Unsystematic risk.b. None of these.c. The cost of debt.d. Systematic risk.While the Weighted Average Cost of Capital reflects the risk perceived by in investors the “real risk” is ____________A firm's overall cost of financing is equal to: I. Its weighted-average cost of capitalII. The required rate of return of its capital providersIII. The returns being generated by investments Select one: A. I only B. I and II only C. I and III only D. I, II, and III
- Which of the following decision criteria is the easiest to use and very popular among investors? O Payback period. O Internal rate of return. O Average accounting return. Net present value. O Discounted return on investment.Suppose a firm makes the following policy changes listed. If a change means that external, nonspontaneous financial requirements (AFN) will increase, indicate this by a (+); indicate a decrease by a (−); and indicate no effect or an indeterminate effect by a (0). Think in terms of the immediate effect on funds requirements.The higher the _____________, the higher the financial risk, and the higher the ____________. a. Interest rate, business risk b. Financial leverage, operating risk c. Financial leverage, cost of capital d. Fixed operating cost, financial risk
- Which of the following is NOT a principle of finance? on Select one: a. company advantage O b. portfolio effect O c. Time Value of Money O d. risk-return tradeoff O e. ValuationWhich of the following is TRUE? I. Internal rate of return (IRR) is a major method for determining the cost of equity. II. The cost of capital depends on the source of the funds. Group of answer choices I and II II only Neither I nor II I onlyWhich one of the following statements related to capital gains is correct? Multiple Choice O O O O The capital gains yield includes only realized capital gains. An increase in an unrealized capital gain will increase the capital gains yield. The capital gains yield must be either positive or zero. The capital gains yield is expressed as a percentage of a security's total return. The capital gains yield represents the total return earned by an investor.
- What does the capital asset pricing model (CAPM) calculate? a. The expected rate of return on an individual stock with respect to the risk-free rate of return b. The expected rate of return of an individual stock based on its overall risk c. The expected rate of return of an individual stock with respect to its market risk only d. The expected rate of return of an individual stock reflecting its financial risk Clear my choiceWhich model is typically used to estimate the cost of using external equity capital? Group of answer choices capital asset pricing model rate of return on perpetuity model arbitrage pricing theory model dividend valuation model