Quiz: TOP 45 câu trắc nghiệm Chapter 4 The value of common stocks (có đáp án) - Tiếng anh chuyên ngành | Đại học Lâm Nghiệp

1 / 45

Q1:

The major secondary market for GE shares is:

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The major secondary market for GE shares is: New York Stock Exchange

2 / 45

Q2:

Assume General Electric (GE) has about 10.3 billion shares outstanding and the stock price is $37.10. Also assume the P/E ratio is about 18.3. Calculate the market capitalization for GE. (Approximately)

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market capitalization = (10.3)(37.10) = $382.13 billion

3 / 45

Q3:

The following are foreign companies that are traded on the New York Stock Exchange: I) Toyota, II) Brasil Telecom, III) Nokia, IV) Endesa, V) General Electric

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The following are foreign companies that are traded on the New York Stock Exchange: I) Toyota, II) Brasil Telecom, III) Nokia, IV) Endesa, V) General Electric: I,II, III and IV only

4 / 45

Q4:

If the Volume is reported in 100s as 292,059 in the Wall Street Journal quotation, then the trading volume for that day of trading is:

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Trading volume = 292059 * 100 = 29,205,900

5 / 45

Q5:

The dividend yield reported as Yld. % in The Wall Street Journal quotation is calculated as follows:

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The dividend yield reported as Yld. % in The Wall Street Journal quotation is calculated as follows: (dividends/close)

6 / 45

Q6:

If the Wall Street Journal Quotation for a company has the following values close: 55.14; Net chg: = + 1.04; then the closing price for the stock for the previous trading day was?

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Previous closing = today's closing net chg. = 55.14 - 1.04 = $54.10

7 / 45

Q7:

The exchange-traded fund (EFT) that tracks the Nasdaq 100 index is called:

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The exchange-traded fund (EFT) that tracks the Nasdaq 100 index is called: QQQQ

8 / 45

Q8:

The Wall Street Journal quotation for a company has the following values: Div: $1.12, PE: 18.3, Close: $37.22. Calculate the dividend pay out ratio for the company (Approximately).

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EPS = (37.22)/18.3 = 2.03; dividend payout = 1.12/2.03 = 0.55 = 55%

9 / 45

Q9:

The following are auction markets except:

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The following are auction markets except: Nasdaq

10 / 45

Q10:

The following is an example of a dealer market:

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The following is an example of a dealer market: Nasdaq

11 / 45

Q11:

In which of the following stock exchange specialists act as the auctioneers: 

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In which of the following stock exchange specialists act as the auctioneers:  New York Stock Exchange

12 / 45

Q12:

In which of the following exchanges a computer acts as the auctioneer: I) New York Stock Exchange, II) London Stock Exchange, III) Tokyo Stock Exchange IV) Frankfurt Stock Exchange

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In which of the following exchanges a computer acts as the auctioneer: I) New York Stock Exchange, II) London Stock Exchange, III) Tokyo Stock Exchange IV) Frankfurt Stock Exchange: II, III, and IV only

13 / 45

Q13:

Super Computer Company's stock is selling for $100 per share today. It is expected that this stock will pay a dividend of 6 dollars per share, and then be sold for $114 per share at the end of one year. Calculate the expected rate of return for the shareholders.

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r = (114 + 6 - 100)/100 = 20%

14 / 45

Q14:

The value of a common stock today depends on:

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The value of a common stock today depends on: The expected future dividends and the discount rate

15 / 45

Q15:

CK Company stockholders expect to receive a year-end dividend of $5 per share and then be sold for $115 dollars per share. If the required rate of return for the stock is 20%, what is the current value of the stock?

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P = (115 + 5)/1.2 = 100

16 / 45

Q16:

Deluxe Company expects to pay a dividend of $2 per share at the end of year-1, $3 per share at the end of year-2 and then be sold for $32 per share. If the required rate on the stock is 15%, what is the current value of the stock?

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P0 = (2/1.15) + [(3 + 32)/(1.15^2)] = $28.20

17 / 45

Q17:

Casino Inc. is expected to pay a dividend of $3 per share at the end of year-1 (D1) and these dividends are expected to grow at a constant rate of 6% per year forever. If the required rate of return on the stock is 18%, what is current value of the stock today?

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P0 = Div1/(r - g) = (3/(0.18 - 0.06)) = 25

18 / 45

Q18:

The constant dividend growth formula P0 = Div1/(r - g) assumes: I) the dividends are growing at a constant rate g forever. II) r > g III) g is never negative.

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I and II only

19 / 45

Q19:

Will Co. is expected to pay a dividend of $2 per share at the end of year -1(D1) and the dividends are expected to grow at a constant rate of 4% forever. If the current price of the stock is $20 per share calculate the expected return or the cost of equity capital for the firm

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r = [(D1/P0 ) + g] = (2/20) + 0.04 = 14%

20 / 45

Q20:

World-Tour Co. has just now paid a dividend of $2.83 per share (D0); the dividends are expected to grow at a constant rate of 6% per year forever. If the required rate of return on the stock is 16%, what is the current value on stock, after paying the dividend?

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P0 = (2.83 * 1.06)/(0.16 - 0.06) = 30

21 / 45

Q21:

The expected rate of return or the cost of equity capital is estimated as follows:

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The expected rate of return or the cost of equity capital is estimated as follows: Dividend yield + expected rate of growth in dividends

22 / 45

Q22:

Dividend growth rate for a stable firm can be estimated as:

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Dividend growth rate for a stable firm can be estimated as: Plow back rate * the return on equity (ROE)

23 / 45

Q23:

MJ Co. pays out 60% of its earnings as dividends. Its return on equity is 15%. What is the stable dividend growth rate for the firm?

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g = (1 - 0.60) * 15 = 6%

24 / 45

Q24:

Michigan Co. is currently paying a dividend of $2.00 per share. The dividends are expected to grow at 20% per year for the next four years and then grow 6% per year thereafter. Calculate the expected dividend in year 5.

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Div6 = (2.0) * (1.20^4) * (1.06) = 4.40

25 / 45

Q25:

Otobai Motor Company is currently paying a dividend of $1.40 per year. The dividends are expected to grow at a rate of 18% for the next three years and then a constant rate of 5% thereafter. What is the expected dividend per share in year 5?

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D5 = (1.4) * (1.18^3) * (1.05^2) = 2.54

26 / 45

Q26:

The In-Tech Co. has just paid a dividend of $1 per share. The dividends are expected to grow at 25% per year for the next three years and at the rate of 5% per year thereafter. If the required rate of return on the stock is 18%(APR), what is the current value of the stock?

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P = (1.25/1.18) + (1.5625/1.18^2) + (1.9531/1.18^3) + (2.0508/((1.18^3) * (0.18 - 0.05)) = 12.97

27 / 45

Q27:

R&D Technology Corporation has just paid a dividend of $0.50 per share. The dividends are expected to grow at 24% per year for the next two years and at 8% per year thereafter. If the required rate of return in the stock is 16% (APR), calculate the current value of the stock

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Po = [(0.5 * 1.24)/1.16] + [(0.5 * 1.24^2)/(1.16^2)] + [(0.5 * 1.24^2 * 1.08)/((1.16^2 * (0.16 - 0.08))] = $8.82

28 / 45

Q28:

Ocean Co. has paid a dividend $2 per share out of earnings of $4 per share. If the book value per share is $25, what is the expected growth rate in dividends (g)?

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Payout ratio = 50%; Plowback ratio = 50%; g = (1 - 0.5) (4/25) = 0.08 or 8%

29 / 45

Q29:

Seven-Seas Co. has paid a dividend $3 per share out of earnings of $5 per share. If the book value per share is $40 and the market price is 52.50 per share, calculate the required rate of return on the stock.

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g = (1 - 0.6) (5/40) = .05 or 5%; r = [(3 * 1.05)/52.50] + 0.05 = 0.11 = 11%.

30 / 45

Q30:

River Co. has paid a dividend $2 per share out of earnings of $4 per share. If the book value per share is $25 and is currently selling for $40 per share, calculate the required rate of return on the stock

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g = (1 - 0.5)(4/25) = 0.08 or 8%; r = [(2 * 1.08)/40] + 0.08 = 13.4%.

31 / 45

Q31:

Lake Co. has paid a dividend $3 per share out of earnings of $5 per share. If the book value per share is $40, what is the expected growth rate in dividends?

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g = (1 - 3/5)(5/40) = .05 or 5%

32 / 45

Q32:

The growth rate in dividends is a function of two ratios. They are:

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The growth rate in dividends is a function of two ratios. They are: ROE and the Retention Ratio.

33 / 45

Q33:

Company X has a P/E ratio of 10 and a stock price of $50 per share. Calculate earnings per share of the company

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EPS = 50/10 = $5

34 / 45

Q34:

Which of the following formulas regarding earnings to price ratio is true:

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EPS/Po = r[1 - (PVGO/Po)

35 / 45

Q35:

Generally high growth stocks pay

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Generally high growth stocks pay: Low or no dividends

36 / 45

Q36:

A high proportion of the value of a growth stock comes from:

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A high proportion of the value of a growth stock comes from: PVGO (Present Value of the Growth Opportunities)

37 / 45

Q37:

Summer Co. is expected to pay a dividend or $4.00 per share out of earnings of $7.50 per share. If the required rate of return on the stock is 15% and dividends are growing at a current rate of 10% per year, calculate the present value of the growth opportunity for the stock (PVGO).

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No growth value = 7.5/0.15 = 50; Po = 4/(0.15 - 0.1) = 80; PVGO = 80 - 50 = 30

38 / 45

Q38:

Parcel Corporation is expected to pay a dividend of $5 per share next year, and the dividends pay out ratio is 50%. If the dividends are expected to grow at a constant rate of 8% forever and the required rate of return on the stock is 13%, calculate the present value of the growth opportunity.

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EPS = (5/0.5) = $10; No Growth Value = 10/0.13 = 76.92; Growth Value = 5/(0.13 - 0.08) = 100; PVGO = 100 - 76.92 = 23.08

39 / 45

Q39:

Which of the following stocks is (are) an income stock(s)?

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Which of the following stocks is (are) an income stock(s): Dow Chemicals

40 / 45

Q40:

The following stocks are examples of income stocks except:

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The following stocks are examples of income stocks except: Starbucks

41 / 45

Q41:

Which of the following stocks is/are a growth stock(s)?

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Which of the following stocks is/are a growth stock(s): Starbucks

42 / 45

Q42:

The following stocks are examples of growth stocks except

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The following stocks are examples of growth stocks except: Scottish Power

43 / 45

Q43:

Universal Air is a no growth firm and has two million shares outstanding. It is expected to earn a constant 20 million per year on its assets. If all earnings are paid out as dividends and the cost of capital is 10%, calculate the current price per share for the stock.

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EPS = DPS = 20/2 = $10 per share = Po = 10/0.1 = 100

44 / 45

Q44:

A firm forecasts of cash flows ($millions) in years 1 thru 4 to be $120, $130, 135, and $137, respectively. If the project ends at the end of the fourth year, what is the horizon value given the company has historical growth of 3% and a discount rate of 10%? (answers in $millions

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If the project terminates, there is no horizon value.

45 / 45

Q45:

A company forecasts growth of 6% for 5 years and 3% thereafter. Given last year's cash flow was $100, what is the horizon value if the company cost of capital is 8%?

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The future value at 5 years of 100 is 133.82. The horizon value = 133.82/(.08 - .03)

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Câu hỏi trắc nghiệm

Giải thích

In which of the following exchanges a computer acts as the auctioneer: I) New York Stock Exchange, II) London Stock Exchange, III) Tokyo Stock Exchange IV) Frankfurt Stock Exchange: II, III, and IV only

Câu hỏi 14 / 45
Giải thích

The value of a common stock today depends on: The expected future dividends and the discount rate

Câu hỏi 21 / 45
Giải thích

The expected rate of return or the cost of equity capital is estimated as follows: Dividend yield + expected rate of growth in dividends

Câu hỏi 22 / 45
Giải thích

Dividend growth rate for a stable firm can be estimated as: Plow back rate * the return on equity (ROE)

Câu hỏi 35 / 45
Giải thích

Generally high growth stocks pay: Low or no dividends

Câu hỏi 36 / 45
Giải thích

A high proportion of the value of a growth stock comes from: PVGO (Present Value of the Growth Opportunities)