1. The cost of capital should reflect the average cost of the various sources of long-term funds a firm uses to acquire assets.
Answer: ___________ _________________
2. The cost of common stock is the rate of return the marginal stockholder requires on the firm's common stock.
Answer: ______________ ______________
3. For capital budgeting and cost of capital purposes, the firm should always consider retained earnings as the first source of capital, i.e., use these funds first, because retained earnings have no cost to the firm.
5. In general, firms should use their weighted average cost of capital (WACC) to evaluate capital budgeting projects because most projects are funded with general corporate funds, which come from a variety of sources. However, if the firm plans to use only debt or only equity to fund a particular project, it should use the after-tax cost of that specific type of capital to evaluate that project.
6. You have funds that you want to invest in bonds, and you just noticed in the financial pages of the local newspaper that you can buy a $1,000 par value bond for $800. The coupon rate is 10% (with annual payments), and there are 10 years before the bond will mature and pay off its $1,000 par value. You should buy the bond if your required return on bonds with this risk is 12%.
7. The payment made each period on an amortized loan is constant, and it consists of some interest and some principal. The closer we are to the end of the loan's life, the greater the percentage of the payment that will be a repayment of principal.
8. If a bank compounds savings accounts quarterly, the nominal rate will exceed the effective annual rate.
9. The present value of a future sum decreases as either the discount rate or the number of periods per year increases.
10. A call provision gives bondholders the right to demand, or "call for," repayment of a bond. Typically, calls are exercised if interest rates rise, because when rates rise the bondholder can get the principal amount back and reinvest it elsewhere at higher rates.
11. The market value of any real or financial asset, including stocks, bonds, or art work purchased in hope of selling it at a profit, may be estimated by determining future cash flows and then discounting them back to the present.
12. Because short-term interest rates are much more volatile than long-term rates, you would, in the real world, generally be subject to much more interest rate price risk if you purchased a 90-day Tbill than if you bought a 30-year Treasury bond.
13. According to the nonconstant growth model discussed in the Financial Management course, the discount rate used to find the present value of the expected cash flows during the initial growth period is the same as the discount rate used to find the Present Values of cash flows during the subsequent constant growth period.
14. If an investor buys enough stocks, he or she can, through diversification, eliminate all of the market risk inherent in owning stocks, but as a general rule it will not be possible to eliminate all company-specific risk.
15. If the returns of two firms are negatively correlated, then one of them must have a negative beta.
Answer: ____________________________© BrainMass Inc. brainmass.com October 16, 2018, 11:25 pm ad1c9bdddf
The solution explains various multiple choice questions relating to cost of capital, cost of stock, WACC, bond return, compounding and present value
Amino acids multiple choice questions
Which statement is incorrect about the classification of amino acids?
a. Alanine and valine are neutral, nonpolar amino acids.
b. Lysine and arginine are basic amino acids.
c. Tryptophan and phenylalanine are aromatic amino acids.
d. Aspartic acid and aspargine are acidic amino acids.
Which of the following amino acids is the least water soluble at pH 7.0?
b. Glutamic acid
Which amino acid would migrate the furthest toward the anode (positive electrode) during paper electrophoresis at pH 7.0?
a. Aspartic acid
Which of the following functional groups, attached to an inert matrix, could function as a cation exchanger?
Which of the following amino acids would make the best buffer at pH 4.5?
d. Aspartic acid
Which fact is incorrect about stereoisomers?
a. A diastereomer is a nonsuperimposable non-mirror image.
b. An enantiomer is a nonsuperimposible mirror image.
c. Diastereomers have different melting points.
d. Diastereomers rotate plane polarized light in equal but opposite direction.
Which statement is incorrect about L-isoleucine?
a. Its enantiomer is named O-isoleucine.
b. It contains a total of two asymmetric or chiral carbons.
c. It can also be named as (28, 38)-isoleucine using the (R,8) system.
d. Its diastereomer would be named O-alloisoleucine.
An isoelectric amino acid was dissolved in water and the resulting pH was approximately 7.6. What amino acid would possess this property?
b. Glutamic acid
What volume of NaOH is required to adjust the solution of monosodium aspartate to pH 9.8?
a. 1 ml
b. 2 ml
c. 3 ml
d. 6 ml or more
What volume of 2 N Hel is required to completely titrate the 4 mmol of monosodium aspartate?
a. 2 ml
d. 6 ml or more
Which statement is correct about the peptide ala-ser?
a. Alanine is at the N-terminal of the peptide.
b. There are a total six atoms that lie in the plane of the peptide bond linking alanine to serine.
c. The alpha-carbon of alanine is sp3 hybridized d All the above are correct statements.
What is the product formed from the acid hydrolysis of a simple amide?
a. Acid & base
b. Aldehyde & alcohol
c. Acid & amine
d. Ester & alcohol
The complete acid hydrolysis of the peptide ala-gln-trp-ser would yield:
a. Ala, gin, trp, ser
b. Ala, glu, ser
c. Ala, glu, trp, ser
d. Ala. ser
Fibrous proteins, such as collagen, have which of the following properties?
a. Highly soluble in water
b. Their hydrophilic residues are directed into the interior of the protein
c. Exhibit enzymatic activity
d. Serve structural roles in the cell
Quaternary structure is associated with:
a. The overall shape of a polypeptide chain
b. The sum of the secondary and tertiary interactions
c. Simple proteins with only one subunit
d. The relative orientation of one polypeptide to another polypeptide in a multi-subunit protein.
The information needed to define the structure of a protein is essentially contained in:
a. Amino acid composition
b. Amino acid sequence
c. Secondary structure
d. Tertiary structure.
Insulin is a polypeptide hormone that contains two short polypeptide chains linked by two interstrand disulfide bonds. The most logical order of events to perform in order to sequence this protein would be:
A: The peptides are reduced with mercaptoethanol.
B: The peptides are sequenced using Edman chemistry .
C: The peptides are separated by chromatography techniques. 0: The peptides are alkylated with iodoacetamide.
a. A, D,C, B b.C,A, 0, B
c. C, B, A, 0
d. A, B, C, 0
Which statement is incorrect about the peptide val-asp-trp-asn-ser?
a. This peptide would show a strong absorption band at 280 nm.
b. Reaction with chymotrypsin would yield two peptides.
c. To synthesize this peptide using the solid phase method of Merrifield, the amino acid directly attached to the resin would be serine.
d. After the second round of Edman chemistry using the reagent PITC, the PTH -amino acid residue released would be PTH-asn.
Which statement is incorrect about the reaction of the peptide ser-Iys-asp-trp-cys-metasn-phe-ala with the following reagents?
a. Reaction with cyanogens bromide would yield two peptides.
b. Reaction with trypsin would result in three peptides. The smallest of three peptides would have the highest pi of the three.
c. Reaciton with chymotrypsin would result in the peptides ser-Iys-asp & try-cys-met-Iysasn-phe-ala .
d. Reaction with chymotrypsin would yield a different set of peptides that overlap those obtained with tryspsin
Determine the amino acid sequence of the following oligopeptide from the experimental data below:
The amino acid composition is found the be ala, Iys, phe, met, cys plus some
2. The peptide has a molecular weight around 700 Da and absorbs at 280 nm.
3. Treatment with carboxypeptidase results in tryptophan and a peptide.
4. CNBr treatment yields a tetrapeptide and a dipeptide.
5. Trypsine digestion produces an amino acid and a pentapeptide with met on the amino end.
6. Chymotrypsin digestion yields a dipeptide and a tetrapeptide.
d. Iys-ala-cys-phe-met -trp