5. The breakeven point in dollars can be computed by dividing the contribution margin into the fixed operating costs.
Multiple-choice( 1point each)
6. The ________ is the extent of an asset ' s risk. It is found by subtracting the pessimistic outcome from the optimistic outcome
7. ________ measure( s) the risk of a capital budgeting project by estimating the NPVs associated with the optimistic, most likely, and pessimistic cash flow estimates
8. If a firm uses an aggressive financing strategy, 9. The two major sources of short-term financing are 10. At the operating breakeven point, ________ equals zero. Problems( show your work)( 1 Point)
11. Xiao Li wishes to accumulate $ 50,000 by the end of 10 years by making equal annual end-of-year deposits over the next 10 years. If Xiao Li can earn 5 percent on her investments, how much must she deposit at the end of each year?
12. Hayley makes annual end-of-year payments of $ 6,260.96 on a fiveyear loan with an 8 percent interest rate. The original principal amount was
13. Hewitt Packing Company has an issue of $ 1,000 par value bonds with a 14 percent annual coupon interest rate. The issue has ten years remaining to the maturity date. Bonds of similar risk are currently