What are the TWO primary advantages of using CAPM over DDM?  It adjusts for risks It does not explicitly consider risk Applicable to companies that pay steady dividends Applicable to companies that pay no dividends

Q: Identify the incorrect statement below; Group of answer choices “Too much inventory can lead to…

A: Current assets are those assets which are to be utilised for the purpose of business in day to day…

Q: Under FASB 52, the temporal method requires that: A. translation gains and losses are included in…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: Purchasing Power Risk is A) the risk of bad business strategy or management decisions being made B)…

A: Purchasing Power Risk is a risk that could cause a possible loss to an investment you made or income…

Q: What is (a) unsystematic risk (company-unique or diversifiable risk) and (b) systematic risk market…

A: The risks are of two types, systematic and unsystematic risk. Systematic risk is tied to the market…

Q: A company's stock price jumped when it announced that its revenue had decreased because of the…

A: In this question, we are required to determine the type of risk in which company's stock price jumps…

Q: Which of the following securities has a purely residual claim against a firm's cash flows? Multiple…

A: The long term sources fulfill the financial requirements of an enterprise for a period of exceeding…

Q: What were the direct and indirect costs of the LIBOR scandal for Barclays? Are these costs only a…

A: The LIBOR Scandal: The LIBOR Scandal came to light in 2012 when Barclays and other banks admitted…

Q: under what circumstances might a company choose not to pay dividends?

A: Dividend Payment and non-payment will be decided by the company based on the future opportunity of…

Q: The way in which the price of securities determined in Financial Markets is:

A: The correct answer is b. Through frequent interaction between investors.

Q: Which of the following is true with Primary Market? Select one: a. None of the options b. Provides…

A: A primary market is a place where securities are created and issued for the first time. It is the…

Q: Hedging refers to a transaction that avoids any financial risks. True or False

A: Hedging is the strategy to offset the risk caused by adverse price movements by way of futures or…

Q: Floatation or issuance cost of new securities are present in an imperfect economy.     True False

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

Q: What type of risk is the risk that is unique to an individual firm?     Systematic risk…

A: There are different types of risks that are associated with investments like risk of change in state…

Q: Which of the following is False in regards to Share premium account? a. It will be shown under the…

A: THE SHARE PREMIUM ACCOUNT REPRESENTS THE DIFFERENCE BETWEEN THE PAR VALUE OF THE SHARES ISSUED AND…

Q: Liquidity risk is A) the risk of bad business strategy or management decisions being made B) the…

A: Liquidity risk is the possibility that an investor or entity may encounter difficulty in buying or…

Q: Factors that influence business risk include except   Group of answer choices   A)liability…

A: Liability uncertainty is one of the factors that can cause business risk. It refers to the potential…

Q: Market risk is defined as the risk: Question 1Answer a. Incurred by granting loans to companies…

A: The objective of the question is to identify the correct definition of market risk in the context of…

Q: Treasury share should not be classified as a current asset. Select one: True False

A: Lets us have basic understanding of treasury shares. This type of shares refer to shares which were…

Q: Companies and even countries can be exposed to .....if they fail to keep up their debit obligations…

A: Tendering is a process in which a project is allotted to a private entity for which multiple parties…

Q: Proponents of the use of Fair Value Accounting (FVA) argue that the use of fair value reflects…

A: Fair Value Accounting (FVA) is a method of accounting that values assets and liabilities at their…

Q: Identify the term being referred to: A theory that states that how high or low an entity pays out…

A: Solution:- There are two theories related to dividend-  Dividend relevance theory and dividend…

Q: 6. Business risk is that type of risk in which: a) The company is unable to meet its financial…

A: Types of risk consist of financial risk, operational risk and business risk.

Q: What are the major instruments traded in capital markets?

A: The capital market helps provide a platform where financial instruments are issued by the firms to…

Q: Firm's that choose to hold more current assets are in general is more ILLIQUID that firms that do…

A: Current assets are resources of value that the company expects to utilize or transform in 1 year to…

Q: Financial risk is the additional risk that stockholders face as a result of using debt, as opposed…

A: Risk denotes the variability in return. When the return fluctuates, then the risk of the security…

Q: TRUE OR FALSE: Assuming an efficient market, two financial securities cannot have the same risk and…

A: The efficient market hypothesis states that information is quickly and accurately reflected in asset…

Q: Investors do not get compensated for holding on to diversifiable risk. True False

A: Risk which are particularly to some companies and can be eliminated or reduced by investing in other…

Q: please explain why insider trading is bringing harm to the capital market activity

A: When the investor's buying and selling the securities from the capital market  from the person who…

Q: Which of the follwong is a true statement about Risk Capital or Owner's Equity? There is no legal…

A: Onwer's equity is sometimes known as risk capital because the equity owner's will get the dividends…

Q: Minimizing liquidity is an excellent way to meet a company's short-term financial obligations. 1)…

A: Liquidity means ability of the company in paying its short term obligations or liabilities.…

Q: Bubbles occur when asset prices are high above their fundamental values do not move even as new and…

A: In financial markets, a bubble occurs when the prices of assets, such as stocks, real estate, or…

Q: FinTech firms are facing increased regulatory oversight. A risk event at a FinTech firm can result…

A: The danger of losing money on an investment or business endeavor is referred to as financial risk.…

Q: Which of the following statements is false?   A.   Mutual funds are pool investor funds to…

A: Working capital is the capital which is required to operate day to day working of a business. It…

Q: A high level of financial leverage exposes firms to default risk. However, as a result of it,…

A: Financial leverage is related to the capital structure of company and it is very important for the…

Q: Discuss the arguments for each position. Some individuals maintain that the only proper accounting…

A: The argument for this statement is this that whether to use current value or not is totally depends…

Q: Recession, inflation, and high interest rates are economic events that are best characterized as…

A: The question is asking us to identify the best characterization of recession, inflation, and high…

Q: The accounting assumption or principle of __________________ is being violated if a company that is…

A: The Full Disclosure Principle states that all relevant and necessary information must be included…