24. The length of time between the sale of inventory and the collection of cash from receivables is called the: 25. The length of time between the acquisition of inventory and its sale is called the: 28. What is the value of a 20-year, zero-coupon bond with a face value of $ 1,000 when the market required rate of return is 9.6 percent, compounded semiannually? 29. Next year ' s annual dividend divided by the current stock price is called the: 32. Jack ' s Construction Co. has 80,000 bonds outstanding that are selling at par value. Bonds with similar characteristics are yielding 8.6 percent. The company also has 4 million shares of common stock outstanding. The stock has a beta of 1.1 and sells for $ 40 a share. The U. S. Treasury bill is yielding 4 percent and the market risk premium is 8 percent. Jack ' s tax rate is 34 percent. What is Jack ' s weighted average cost of capital? 34. When computing the weighted average cost of capital, which of these are adjusted for taxes? 37. No matter how many forms of investment analysis you employ: 38. Foamsoft sells customized boat shoes. Currently, it sells 16,850 pairs of shoes annually at an average price of $ 79 a pair. It is considering adding a lower-priced line of shoes which sell for $ 49 38. Which statement concerning the net present value( NPV) of an investment or a financing project is correct? 36 The CAPM has an advantage over DDM because the CAPM: 37. For a firm to create value it must: 40. Marshall ' s purchased a corner lot five years ago at a cost of $ 498,000 and then spent $ 63,500 on grading and drainage so the lot could be used for storing outdoor inventory. The lot was recently appraised at $ 610,000. The company now wants to build a new retail store on the site. The building cost is estimated at $ 1.1 million. What amount should be used as the initial cash flow for this building project? 42. A proposed project costs $ 300 and has cash flows of $ 80, $ 200, $ 75, and $ 90 for Years 1 to 4, respectively. Because of its high risk, the project has been assigned a discount rate of 16 percent. In dollars, how much will this project return in today’ s dollars for every $ 1 invested? 45. What is the net present value of a project that has an initial cash outflow of $ 7,670 and cash inflows of $ 1,280 in Year 1, $ 6,980 in Year 3, and $ 2,750 in Year 4? The discount rate is 12.5 percent.