1. Briefly explain the basic points of each dividend theory: Dividend Irrelevance, Signaling Hypothesis, Clientele Effect, and Residual Distribution Model. Which theory or theories appear to be widely implemented by management? What are the trends with relation to dividends versus stock repurchases? Cite at least two popular press articles that support your position.

2. What is the difference between business risk and financial risk? Explain the concepts of levered and unlevered beta in relation to these types of risk.

3. Briefly explain each of the following capital structure theories: Modigliani and Miller Irrelevance, Trade-Off Theory, and Reserve Borrowing Capacity. Which of these theories appear to impact management decisions in real life?

4. What is the role of the investment banker in the IPO process? What are the risks to the investment banker? Other than the firms discussed in class, identify an IPO from the last 10 years. Provide the selling price, lead investment bank, total amount raised, and the stocks price activity that day, during the next week, and over the next year. Give specific ranges for the stock price.

5. Why might a firm decide to go private? Provide the benefits and a potential scenario. Other than the firms mentioned in class, identify at least one firm that has been taken private and subsequently went public again. Who were the main principals (equity firms) that took the company private? How long was it between going private and going public? Please provide the citation that gave you the information.

6. What are the pros and cons of lease financing? How does FASB 13 Statement 13 impact these pros and cons?