BUS 401 Week 4 Quiz (New)

1. Total risk is measured by

2. The financing mix reflected in the WACC should:

3. Which of the following is true of flotation costs?

4. One reason why we are not concerned with idiosyncratic risk (also called firm-specific risk) is that:

5. Which of the following best describes a pure-play?

6. The Hamada Equation allows the firm to:

7. In the Capital Asset Pricing Model, the risk-free rate

8. A bond pays semiannual coupon payments of $30 each. It matures in 20 years and is selling for $1,200. What is the firm’s cost of debt if the bond’s par value is $1,000? (Don’t forget this is a semiannual coupon.)

9. Chapter 9 discusses three different types of returns. Identify the item in the list below that is NOT one of those three types of returns.

10. Which of the following is beta is used for?