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33. Filer Manufacturing has 8.9 million shares of common stock
outstanding. The current share price is $59, and the book value per share
is $4. The company also has two bond issues outstanding. The first bond
issue has a face value of $71.2 million and a coupon ra te of 7.6 percent
34. When estimating the cost of equity using the DDM, which one of these
is most apt to add error to this estimate?
35.When computing WACC, you should use the:
36. The cost of preferred stock:
37. The difference between the present value of an investment’s future
cash flows and its initial cost is the:
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
39.The net present value method of capital budgeting analysis does all of
the following except:
40. Graham and Harvey (2001) found that _____ were the two most
popular capital budgeting methods.
41. The primary reason that company projects with positive net present
values are considered acceptable is that:
42. What is the net present value of a project with an initial cost of $36,900
and cash inflows of $13,400, $21,600, and $10,000 for Years 1 to 3,
respectively? The discount rate is 13 percent.
43. Flatte Restaurant is considering the purchase of a $10,800 soufflé
maker. The soufflé maker has an economic life of five years and will be
fully depreciated by the straight-line method. The machine will produce