财务管理试卷及答案(英文版)

1、Examination Problems for Fundamentals of Financial Management 2004-2005 (Paper B)I. Multiple Choice (20 points) (Please write your answer in the following table)题号1234567891011121314151617181920选项1. ( ) is concerned with the acquisition, financing, and management of assets with some overall goal in

2、mind.A. Financial management B. Profit maximization C. Agency theory D. Social responsibility2.A major disadvantage of the corporate form of organization is the ( ).A. double taxation of dividendsB. inability of the firm to raise large sums of additional capitalC. limited liability of shareholdersD.

3、 limited life of the corporate form.3. Interest paid (earned) on both the original principal borrowed (lent) and previous interest earned is often referred to as ( ).A. present value B. simple interest C. future value D. compound interest4. If the intrinsic value of a share of common stock is less t

4、han its market value, which of the following is the most reasonable conclusion?A. The stock has a low level of risk.B. The stock offers a high dividend payout ratio.C. The market is undervaluing the stock.D. The market is overvaluing the stock.5. A 250 face value share of preferred stock, pays a 20

5、annual dividend and investors require a 7% return on this investment. If the security is currently selling for 276, what is the difference (overvaluation) between its intrinsic and market value (rounded to the nearest whole dollar)?A. approximately 26 B. approximately 10 C. approximately 6 D. approx

6、imately 16. Felton Farm Supplies, Inc., has an 8 percent return on total assets of 300,000 and a net profit margin of 5 percent. What are its sales?A. 3,750,000 B. 480,000 C. 300,000 D. 1,500,0007. A company can improve (lower) its debt-to-total asset ratio by doing which of the following?A. Borrow

7、more. B. Shift short-term to long-term debt. C. Shift long-term to short-term debt. D. isssue common stock.8. The DuPont Approach breaks down the earning power on shareholders book value (ROE) as follows: ROE = ( ).A. Net profit margin Total asset turnover Equity multiplierB. Total asset turnover Gr

8、oss profit margin Debt ratioC. Total asset turnover Net profit marginD. Total asset turnover Gross profit margin Equity multiplier9. Which of the following items concerns financing decision? ( )A. sales forecasting B. bond issuing C. receivables collection D. investment project selection10. Which of

9、 the following items is the function of a treasurer? ( )A. cost accounting B. internal control C. capital budgeting D. general ledger11. For financial instruments, ( ) is judged in relation to the ability to sell a significant volume of securities in a short period of time without significant price

10、concession.A. maturity B. marketability C. default D. inflation12. ( ) is the value at some future time of a present amount of money, or a series of payments, evaluated at a given interest rate.A. future value B. present value C. intrinsic value D. market value13. Ellesmere Corporation issues 1 mill

11、ion $1 par value bonds. The stated interest rate is 6% per year and the interest is paid twice a year. What is the real interest rate of the bond? ( )A. 6% B.3% C. 12% D. (1+6%/2)2-114. Assume that dividends of a common stock will be maintained at D forever, and the required return of the stockholde

12、r is r, the par value of the stock is m, the value of the stock is ( )A. m B. m+D C. m+D/r D. D/r15. Which of the following items has the most risk? ( )A. treasury bill B. corporate bond C. preferred stock D. common stock16. ( ) equals the gross profit divided by net sales of a firm.A. gross profit

13、margin B. net profit margin C. return on investment D. return on equity17. ( A ) is the ratios that measure a firms ability to meet short-term obligationsA. liquidity ratios B. leverage ratios c. coverage ratios D. activity ratios18. ( A ) is the result of Net Profit Margin total asset turnover (tot

14、al assets/shareholders equity)A. Return on equity B. return on investment C. current ratio D. quick ratio19. Government tax law adjustment is ( A ) to a firm.A. general economic risk B. inflation and deflation risk C. firm-specific risk D. international risk 20 ( A ) equals the gross profit divided

15、by net sales of a firm.A. gross profit margin B. net profit margin C. return on investment D. return on equityII. Statement judgement (10 Points) (Please write your answer in the following table)题号12345678910或1. Until around the first half of the 1900s, financial managers primarily raised funds and

16、managed their firms cash positions. ( )2. In general, the higher the marketability of a security, the greater the yield necessary to attract investors ( )3. Discount Rate is the interest rate used to convert future values to present values. ( )4. The expected return of a portfolio is simply a weight

17、ed average of the expected return of the securities comprising that portfolio ( )5. 5. The type of analysis varies according to the specific interests of the party involved ( )6. In a sole proprietorship, the owner is personally responsible for all financial obligations of the firm. ( )7. When a sto

18、ck goes ex-rights, its market price theoretically declines. ( )8. The market price of a particular bond is much greater today than it was yesterday. The calculated yield to maturity (YTM) based on todays market price would, therefore, be greater than the calculated YTM based on yesterdays market pri

19、ce. ( )9. A short average collection period assures us that accounts receivable are being efficiently managed. ( )10. Simple interest is interest that is paid on only the original amount borrowed (lent) ( )III. Questions (10 points) (Please write your answer on the answer paper)1. The method of depr

20、eciation does not alter the total amount deducted from income during the life of an asset. What does it alter and why is that important? (5 )2. What is primary and secondary market? (5)IV. Problems (60 Points) (Please write your answer on the answer paper)1. you need to have $100000 at the end of 10

21、 years. To accumulate this sum, you have decided to save a certain amount at the end of each next 10 years and deposit it in the bank. The bank pays 8% interest compounded annually for long-term deposit. How much will you have to save each year? (PVIF(8%,10)=0.463, PVIFA(8%,10)=0.671, FVIF(8%,10)=2.

22、159, FVIFA(8%,10)=14.487)2.Just today, Bird Seed Companys common stock paid a $1.50 annual dividend per share and had a closing price of $24. Assume that the markets required return for this investment is 12% and that dividends are expected to grow at a constant rate forever.a. calculate the implied

23、 growth rate in dividends.b. what is expected dividend yield and capital gains yield?3. The data for various companies in the same industry are as follows: (amounts are in million dollars)CompanyABCDEFSales101587612Total assets8106459Net income324233Net profit marginTotal assets turnoverDetermine th

24、e total asset turnover, net profit margin, and write your computation result in the table.4. You expect to deposit the following cash flows at the end of years 1 through 5, 1,000; 4,000; 9,000; 5,000; and 2,000 respectively. Alternatively, you could deposit a single amount today at the beginning of

25、year 1 (end of year 0). How much is the single deposit needed to be today if you can earn 10% compounded annually? (10/ )5.Stock A has an expected growth rate of 16% for the first 3 years and 8% thereafter. Each share of stock just received an annual 3.24 dividend per share. The appropriate discount

26、 rate is 15%. What is the value of the common stock under this scenario? (10/ )6. The following common stocks are available for investment: COMMON STOCK (TICKER SYMBOL) BETA Nanyang Business Systems (NBS) 1.40 Yunnan Garden Supply, Inc. (YUWHO) .80 Bird Nest Soups Company (SLURP) .60 W! (WAC

27、HO) 1.80 Park City Cola Company (BURP) 1.05 Oldies Records, Ltd. (SHABOOM) .90 a. If you invest 20 percent of your funds in each of the first four securities, and 10 percent in each of the last two, what is the beta of your portfolio? (5/ ) b. If the risk-free rate is 8 percent and the expected retu

28、rn on the market portfolio is 14 percent, what will be the portfolios expected return? (5/ )Solutions (B)I. Multiple Choice (20 points) (Please write your answer in the following table)题号1234567891011121314151617181920选项AADDBBDABCBADDDAAAAAII. Statement judgement (10 Points) (Please write your answe

29、r in the following table)题号12345678910或III. Questions (10 points) (Please write your answer on the answer paper)1. Depreciation changes the timing of tax payments. The longer these payments can be delayed, the better off the business is.2. A primary market is a “new issues” market. Here, funds raise

30、d through the sale of new securities flow from ultimate savers to the ultimate investors in real assetsIn a secondary market, existing securities are bought and sold. Transactions in these already existing securities do not provide additional funds to finance capital investmentIV. Problems (60 Point

31、s) (Please write your answer on the answer paper)1. Answer:100000=A FVIF(8%,10)=14.487A A=100000/14.487=69032. Answer:a. 24=1.5(1+g)/(0.12-g), g=0.054b. dividend yield=0.12-g=0.066, capital gains yield=0.0543. Answer:CompanyABCDEFSales101587612Total assets8106459Net income324233Net profit margin0.30.13330.50.28570.50.25Total assets turnover3.33337.523.5244. 1. (10/ ) Many different methods to lead to a correct solution. PV of this mixed flows problem = 1,000(PVIF10%,1) + 4,000(PVIF10%,2) + 9,00