İŞLETME FİNANSI II

Which of the following is not amongst the characteristics of Eurobonds?

Which of the following is not amongst the advantages of common stock?

ABC Corp.’s stock sells at $12. The company’s expected growth rate is 5.2% next year and last year stockholders received $1.5 dividends per share.



According to above data, what is the cost of equity of ABC Corp?

X Corp.’s preferred stock is currently selling for $20, and pays a perpetual annual dividend of $4 per share. Underwriters of a new issue of preferred stock would charge $2.5 per share in flotation costs. The firm’s tax rate is 40%.



According to above data, what is the cost of new preferred stock for X Corp?

The company has 40% debt and 60% equity in capital structure. Company costs are 12% on its debt, and 18% on its equity. (the tax rate of company is 35%)



According to above data, what is the WACC for the company?

DFE Corp. will issue new common stock to finance a replacement. The existing common stock paid a $6.25 dividend per share, and dividends are expected to grow at a constant rate 5%. The stock sells for $50, and flotation costs of 3% will be incurred on new shares.



According to above data, what is the cost of new common stock?

DUO Corp. has a historical beta of 1.38 and the expected market return is 13%, whereas the risk-free rate is 4%.



According to above data, what is the required return of the stockholders of DUO?

Which of the following statement is true about net operating income approach?

What is the after-tax cost of debt for a firm with the 40% tax paying that pays 12% on its debt?

Suppose that there are two companies which are selling in the market at different prices and they are almost identical except their capital structures. Which of the following statement can be true about these companies according to Modigliani and Miller theory?

Which of the theory advocates that asymmetric information affect on capital structure?

Value of the firm is $5.25 million, its unlevered value is $4.1 million, and the present value of bankruptcy and agency costs are $160,000 and $180,000.



According to these data, what is the value of the tax shield of the firm?

Which of the following term refers to a cash outlay that already has been incurred and that cannot be recovered regardless of whether the capital investment project is accepted or rejected?

Suppose that “Blue Company” has a project proposal, requiring initial investment of 180 million USD to consider. Projected non-cumulative cash inflows (USD in millions) of the project for the next four years are as follows.


Year 1 - 40
Year 2 - 50
Year 3 - 80
Year 4 - 120


According to above data, how long (in years) is the payback period of the project?

Suppose that “Red Company” has a project proposal, requiring initial investment of 500 million USD. to consider. The expected rate of return from expansion investments (discount rate) is 20%. Projected non-cumulative cash inflows (USD in millions) of the project for the next three years are as follows.


Year 1 - 190
Year 2 - 280
Year 3 - 400


(1.22  1.44; 1.23  1.73)


Relying above information, what is the net present value of the project? (USD in millions)

Which of the following is used in order to modify internal rate of return in “Modified Internal Rate of Return Technique” of capital project evaluation?

Which of the following is not one of the factors effecting evaluation of a real option?

Which of the following is not considered by the financial institutions to provide medium and long term lending?

Optimum capital structure is ------- .

Which of the following completes sentence above?

Which of the following is not true for call provision in a bond issue?