EXAM CODE $02$

$8.$ Mr$.$ Avor is a mining engineer at Goldfields Ghana and receives USD$8,500$ as salary. However, Newmont Ghana needs his services at the cost of USD$9,900.$ Using the opportunity cost concept as a method of accounting for human resource, what is the cost of this mining engineer?

A$.$ USD$1,400$

B$.$ USD$8,500$

C$.$ USD $18,400$

D$.$ USD$9,900$

$9.$ Using Gordon growth model, what is the terminal value of a firm whose weighted average cost of capital is $12\%$ and a growth rate of $8\%$ and is projected to have a free cash flow of GHS $60,000$ in its last year?

A$.$ GHS $1,500,000$

B$.$ GHS$6,250,000$

C$.$ GHS$576,000$

D$.$ GHS $15,000,000$

$10.$ A firm has a higher quick $($or acid test$)$ ratio than the industry average, which implies

the firm has a higher $\frac{P}{E}$ ratio than other firms in the industry.

II$.$ the firm is more likely to avoid insolvency in short run than other firms in the industry.

III. the firm may be less profitable than other firms in the industry.

A$.$ I and II only

B$.$ I and III only

C$.$ I, II and III

D$.$ II and III only

Which of the following provides a snapshot of the financial condition of the firm at a particular time?