Exam 14: Introduction to Corporate Financing

Disregarding issues of risk and return,why might it be important to shareholders and management alike as to what class of equity is issued (e.g.,common,preferred,etc.)?

To state that financing at current market terms is a zero-NPV transaction indicates that:

If a corporation uses cumulative voting,then ______ of a shareholder's votes _____ be cast for one candidate.

What is the book value per share of equity for a firm with $1 million in net common equity,$50,000 in authorized share capital,25,000 shares issued,and 20,000 shares outstanding?

If the Beta company issues $100 million worth of preferred stock,what will happen to its net worth if book value of common equity is $500 million?

If shareholders do not like the policies that management pursues,their easiest solution is to vote in a different board of directors.

Protective covenants prevent bond issuers from irresponsible overborrowing behavior and are offered for the benefit of:

Eurobonds are long-term,corporate liabilities that:

Which of the following balance-sheet accounts will be affected when the company buys back some of its outstanding shares?

What is the most commonly bundled type of loan in among asset-backed bonds?

Which of the following bonds is likely to be viewed by investors as the riskiest?

Which of the following statements is true with respect to financial and product markets?

What procedures are used for elections to a firm's board of directors and other matters put to shareholders?

A corporation with funded fixed-rate debt might prefer floating-rate debt if it thought that:

Limiting the size of dividends paid is an example of a protective covenant.

Preferred stockholders:

What will be the effect on retained earnings if a firm with 5,000 shares outstanding earns $10 per share and has a 30% plowback ratio? It will increase by:

The system of electing a board of directors where each director is voted on separately is known as:

Which of the following equity concepts would you expect to be least important to a financial analyst?

What type of voting does a corporation have if there are two directors to elect and Director Jones received 50 votes from a shareholder who owns 100 shares?