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STR581 Phoenix Week 6 Set 2 Strategic Planning Quiz Help

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STR581 STR/581 FINAL EXAM CAPSTONE 38/39 1. Which of the following financial statements is concerned with the company at a point in time? income statement statement of cash flows retained earnings statement balance sheet 2. A cost which remains constant per unit at various levels of activity is a: fixed cost mixed cost variable cost manufacturing cost 3. M&M Proposition 1: Dynamo Corp. produces annual cash flows of $150 & is expected to exist forever. The company is currently financed with 75 percent equity & 25 percent debt. Your analysis tells you that the appropriate discount rates are 10 percent for the cash flows, & 7 percent for the debt. You currently own 10 percent of the stock. If Dynamo wishes to change its capital structure from 75 percent equity to 60 percent equity & use the debt proceeds to pay a special dividend to shareholders, how much debt should they use? $600 $375 $225 $321 4. Serox stock was selling for $20 two years ago. The stock sold for $25 one year ago, & it is currently selling for $28. Serox pays a $1.10 dividend per year. What was the rate of return for owning Serox in the most recent year? (Round to the nearest percent.) 32% 16% 12% 40% 5. The process of evaluating financial data that change under alternative courses of action is called: contribution margin analysis cost-benefit analysis double entry analysis incremental analysis 6. What decision criteria should managers use in selecting projects when there is not enough capital to invest in all ...
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