90.2K

Verified Solution

Link Copied!

Delta, Inc. has $420,000$ shares outstanding at a market price of $$33\mathrm{.}00$ a share. If the company declares a $3-$for$-2$ stock split, they will have shares outstanding at a market price of

A$.280,000$; $$33\mathrm{.}00.$

B$.280,000$; $$49\mathrm{.}50.$

C$.630,000$; $$22\mathrm{.}00.$

D$.630,000$; $$49\mathrm{.}50\mathrm{.}7.$

The empirical observation that stocks attract particular investors based on the firm's dividend policy and taxation on investors is called the

A$.$ clientele effect

B$.$ Efficient Markets Hypothesis

C$.$ M&M Propositions

D$.$ information content effect

$8.$ On January $2,$ a company declared a dividend of $$0\mathrm{.}75$ per share payable on January $28$ to shareholders. The ex dividend date is January $10.$ If you bought $500$ shares of the company's stock on January $10$ for $$7\mathrm{.}50$ per share, how much will you receive in dividends?

A$.$ $$0\mathrm{.}00.$

$$37\mathrm{.}50.$

$$55\mathrm{.}00$

D$.$ $$375\mathrm{.}009.$

Which of the following is true:

A$.$ When a call option on Suncor Energy is exercised, Suncor issues more stocks.

B$.$ Writers promise to deliver shares if exercised by the buyer.

C$.$ The writer has the option to sell shares but not an obligation.

D$.$ The writer receives a cash payment from the buyer at the time the option is purchased.

$10.$ A firm's WACC is $10\%$ and the firm does not have preferred stock. Its after$-$tax cost of debt is $6\%,$ and its cost of equity is $15\%.$ What is the firm's debt$-$to$-$equity ratio?

A$.0\mathrm{.}33$

B$.0\mathrm{.}69$

C$.1\mathrm{.}00$

D$.1\mathrm{.}25$

Answer & Explanation Solved by verified expert

See Answer