36. Company B has irredeemable loan note currently trading at $50 ex interest. The coupon rate is 5% and the rate of corporate tax is 20%. A. 0.08 B. 4% C. 80% D. 0.008

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question 36
33. A company currently pays dividend of 32 pesewas, five years ago the dividend was
20 pesewas. Estimate the annual growth rate in dividend using the estimated
dividend growth from past dividend patterns.
A. 9.85%
B. 10.10%
C. 8.95%
D. 11.85%
34. Palm ple. has a fixed rate bank loan of 2 million. The company is charged 12% p.a.
the corporate tax rate is 35%. What is the cost of loan?
A. 7%
B. 6%
C. 7.8%
D. 3.9%
35. Which of the following is a deposit-taking financial institution?
A. Pension Company
B. Insurance company
C. Savings and Loan
D. Collective Investment company
36. Company B has irredeemable loan note currently trading at $50 ex interest. The
coupon rate is 5% and the rate of corporate tax is 20%.
A. 0.08
B. 4%
C. 80%
D. 0.008
37. Delco ple. has 50,000, 5% preference shares in issue, nominal value ¢2 The current
ex div MV is ¢1.30 per share. What is the cost of preference share?
A. 0.04
B. 0,05
C. 0.015
D. 3.85
38. Which of the following ratio's is under investment ratio?
A. Earning yield.
B. Expense to sales ratio
C. Account Payable
Page 7 of 10
D. Stock Turnover Ratio
39. The following are roles of financial manager except
A. Planning and Forecasting
B. Raising Finance
C. Allocation and Control of financial decision
D. Preparing financial statement
40. Manuel plc. plans to pay a dividend next year of 24 pence. Shareholders expect
annual dividends to grow by 1.5% into foreseeable future. The return required by
equity shareholders is 7.5%. what is the expected value of the company's share?
A. 400 pence
D 160
University of Professional Studies, Ac
P. O. Box LG 149, Aces 1
Graduate Library
Transcribed Image Text:33. A company currently pays dividend of 32 pesewas, five years ago the dividend was 20 pesewas. Estimate the annual growth rate in dividend using the estimated dividend growth from past dividend patterns. A. 9.85% B. 10.10% C. 8.95% D. 11.85% 34. Palm ple. has a fixed rate bank loan of 2 million. The company is charged 12% p.a. the corporate tax rate is 35%. What is the cost of loan? A. 7% B. 6% C. 7.8% D. 3.9% 35. Which of the following is a deposit-taking financial institution? A. Pension Company B. Insurance company C. Savings and Loan D. Collective Investment company 36. Company B has irredeemable loan note currently trading at $50 ex interest. The coupon rate is 5% and the rate of corporate tax is 20%. A. 0.08 B. 4% C. 80% D. 0.008 37. Delco ple. has 50,000, 5% preference shares in issue, nominal value ¢2 The current ex div MV is ¢1.30 per share. What is the cost of preference share? A. 0.04 B. 0,05 C. 0.015 D. 3.85 38. Which of the following ratio's is under investment ratio? A. Earning yield. B. Expense to sales ratio C. Account Payable Page 7 of 10 D. Stock Turnover Ratio 39. The following are roles of financial manager except A. Planning and Forecasting B. Raising Finance C. Allocation and Control of financial decision D. Preparing financial statement 40. Manuel plc. plans to pay a dividend next year of 24 pence. Shareholders expect annual dividends to grow by 1.5% into foreseeable future. The return required by equity shareholders is 7.5%. what is the expected value of the company's share? A. 400 pence D 160 University of Professional Studies, Ac P. O. Box LG 149, Aces 1 Graduate Library
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