Reference no: EM13890482
1. The issuance of bonds to raise capital for a corporation:
A) magnifies the returns to the stockholders.
B) increases risk to the stockholders.
C) is a cheaper form of capital than the issuance of common stock.
D) all of the above.
2. Common stockholders are essentially:
A) creditors of the firm.
B) managers of the firm.
C) owners of the firm.
D) all of the above.
3. Which of the following are typical consequences of good capital budgeting decisions?
A) The firm increases in value.
B) The firm gains knowledge and experience that may be useful in future decisions.
C) Good capital budgeting decisions help a company define its core competencies.
D) All of the above.
4. Which of the following factors is least important to capital budgeting decisions.?
A) The time value of money
B) The risk-return tradeoff
C) Net income based on accrual accounting principles
D) Cash flows directly resulting from the decision
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Typical consequences of good capital budgeting decisions
: The issuance of bonds to raise capital for a corporation: Common stockholders are essentially: Which of the following are typical consequences of good capital budgeting decisions?
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