Preferred stock with cumulative fixed dividends
Course:- Financial Management
Reference No.:- EM13891888

Assignment Help
Assignment Help >> Financial Management

1. Factors that should be considered in taking a stock option position include:

A:   The dividend paid on the underlying stock

B:   The volatility of the underlying stock

C: The time to expiration

D: The anticipated direction of market movement

E:   All of the above are relevant factors in the option decision

2. Advantages of investing in tax-exempt bond funds include all of the following EXCEPT:

A:   Diversification

B:   Provides additional benefits to tax-deferred retirement plans

C: Automatic reinvesting

D: Fund maintains individual investor’s tax reports and records

E:   Low initial deposit

3. Angie deposits $250 in an account that earns 12% per year. If no other deposits or withdrawals are made, how much will Angie have in her account at the end of 15 years?

A: $ 280

B: $ 700

C: $1,368

D: $3,450

E: $4,200

4. Zack needs a $100,000 loan to start his new business. Due to his age and inexperience, he is unable to obtain a bank loan. Possible alternatives to raise the funds include all of the following EXCEPT

A: promissory note from his mother.

B: having his mother co-sign a bank loan.      

C: selling personal assets.

D: issuing debt in the market.

E: all of the above are possible sources of funds for Zack.

5. Preferred stock with cumulative fixed dividends

A: Are required to pay dividends each quarter

B: Must pay the missed dividend before common shareholders can receive dividends

C: Are taxed on the accumulated dividends

D: Are considered to be bankrupted if one year of dividends is missed

E: All of the above are true

Put your comment

Ask Question & Get Answers from Experts
Browse some more (Financial Management) Materials
If you require a 9 percent return on bonds such as these with 5 years remaining until maturity and 8.2 percent on bonds such as these with 12 years remaining until maturity,
George bought a piece of equivalent for 35,000$. The equipment has a useful life of 10 years and a salvage value of 2,000$ at the end of its useful life. Assume that the annua
A firm's preferred stock is selling for $27.50 a share. The firm nets $25.60 after issuance costs. The stock pays an annual dividend of $3.00 per share. What is the cost of ex
What does it mean when cash flow from operations, investing activities, financial activities on a company's cash flow statement is negative? Is this bad news? Is it dangerous?
Sloan Transmissions, Inc., has the following estimates for its new gear assembly project: price = $2,900 per unit; variable costs = $580 per unit; fixed costs = $5.2 million;
When measuring the cost of capital, many companies measure the cost of the common stock in the company. However, does common stock have a cost when there is no obligation to p
A Treasury bond with the longest maturity (30 years) has an ask price quoted at 97:01. The coupon rate is 2.60 percent, paid semiannually. What is the yield to maturity of thi
Randal Flapjack is a retired short-order cook living on a fixed income in the state of Utopia where all financial markets are perfectly efficient. What is Sugarcooky's current