Please answer the multiple choice questions:

1. A transportation company reported net income of $100,000, including $5,000 of income from discontinued operations and $15,000 of goodwill impairment. NOPAT is
   1. $95,000
   2. $105,000
   3. $110,000
   4. $115,000

2. The most common place for management to disclose their forecasting guidance
   1. MD&A
   2. SEC EDGAR
   3. The financial statements
   4. The financial statement footnotes

3. A forecasted 50-point basis point drop in Cost of Goods Sold is equal to
   1. -0.50%
   2. -5.0%
   3. -50.00%
   4. -500%

4. When a company gives guidance in a range (i.e., sales growth of 3% to 5%), the common forecasting practice is
   1. To ignore the guidance
   2. To use the low end of the range
   3. To use the high end of the range
   4. To use the midpoint of the range

5. When an analyst does not start his/her forecast with the guidance provided by management, and instead uses figures (s)he came up with on her own.
   1. Segment forecasting
   2. Top-down forecasting
   3. Bottom-up forecasting
   4. Wildcatter forecasting

6. Forecasting a companys projected statement of cash flows begins with
   1. NOA
   2. WACC
   3. NOPAT
   4. Net Income

7. Sensitivity analysis is generally used to
   1. Explore how sensitive investors are to negative events
   2. Examine how sensitive the company is to market forces
   3. Identify how much the forecast changes if assumptions change
   4. All of the above

8. Valuation is not commonly used to
   1. Determine an investors tax liability
   2. Determine a companys fair share price
   3. Determine a fair initial public offering price
   4. Valuation is commonly used for all of the above

9. The underlying variable on which all sophisticated valuation models rest
   1. Earnings
   2. Cash flow
   3. Net Income
   4. Price Per Share

10. As risk increases, an investors required rate of return
    1. Increases
    2. Decreases
    3. Is Not Affected
    4. Not Enough Information

11. Stock market share price quotes always reflect a companys intrinsic value accurately
    1. True
    2. False

12. As the risk-free rate increase, the required rate of return
    1. Increases
    2. Decreases
    3. Is Not Affected
    4. Not Enough Information

13. An assumption of the stock market is that
    1. It is liquid
    2. It is efficient
    3. It is observable
    4. All of the above