GENERAL FINANCE MCQ The rate of return required by investors in the marketfor owning a company's stock is known as the:a) Coupon rateb) Required rate of returnc) Risk-free rated) Yield to maturity

Explanation of Required Rate of Return: The required rate of return is the minimum return that…

Answered: The rate of return required by…

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter10: Valuing Early-stage Ventures

Section: Chapter Questions

Problem 4DQ

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What does the capital asset pricing model (CAPM) calculate? a. The expected rate of return on an individual stock with respect to the risk-free rate of return b. The expected rate of return of an individual stock based on its overall risk c. The expected rate of return of an individual stock with respect to its market risk only d. The expected rate of return of an individual stock reflecting its financial risk Clear my choice
Current yield is used to determine Seleccione una: a. A portion of the yield on an investment b. The payout of a bond investment c. The amount of money a bond investor will earn d. The coupon rate of a bond investment
Discuss how market interest rates are affected by borrowers' need for capital, expected inflation, different securities' risks, and securities' liquidity. • Describe how risk aversion affects a stock's required rate of return.
A yield curve compares expected returns of stock and bonds to their maturities. Select one: True OR False
Define the terms covariance and correlationcoefficient. How are they related to one another,and how do they affect the required rate of returnon a stock? Would correlation affect its requiredrate of return if a stock were held (say, by the company’s founder) in a one-asset portfolio?
What is relationship between the market risk of a stock and it's expected return?
Which one of the following is an example of mental accounting? Multiple Choice O associating a security's gains or losses based on its purchase price calculating the gain or loss on a security on a daily basis O computing the amount of tax due on the gain from a stock sale considering the gain realized when a stock pays a dividend comparing the gains and losses on a portfolio to those of the overall market
Discuss how changes in the general stock and bond markets could lead to changes in the required rate of return on a firm’s stock
A stock's internal rate of return (IRR) is the discount rate that cause the present value of future dividends and the price at which a stock is expected to be sold to equal the current price of the stock. O True O False C
How would changes in the general stock and bond markets lead to changes in the required rate of return on a firm’s stock?
Explain how to find the value of a stock given itslast dividend, its expected growth rate, and itsrequired rate of return.
When using discounted dividend method to estimate stock price, which of the following should be used as the discount rate? - required return of debt - risk free rate - required return of the equity - WACC - Bank deposit rate

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The rate of return required by investors in the market for owning a company's stock is known as the: a) Coupon rate b) Required rate of return c) Risk-free rate d) Yield to maturity