Question: Please show the work for calculation type questions 6) A ________ is the term used to describe a foreign currency agreement between two parties to
Please show the work for calculation type questions
6) A ________ is the term used to describe a foreign currency agreement between two parties to exchange a given amount of one currency for another, and after a period of time, to give back the original amounts.
A) matched flow
B) currency swap
C) back-to-back loan
D) none of the above
7) The weighted average cost of capital (WACC) is:
A) the required rate of return for all of a firm's capital investment projects.
B) the actual rate of return for a firm's average risk projects.
C) not applicable for use by MNE.
D) None of the above
8) ________ risk is a function of the variability of expected returns of the firm's stock relative to the market index and the measure of correlation between the expected returns of the firm and the market.
A) Accepted
B) Unsystematic
C) Beta Measured
D) Diversifiable
9) The after-tax cost of debt is found by:
A) dividing the before-tax cost of debt by (1 - the corporate tax rate).
B) subtracting (1 - the corporate tax rate) from the before-tax cost of debt.
C) multiplying the before-tax cost of debt by (the corporate tax rate).
D) None of the above
10) A firm whose equity has a beta of 1.0:
A) has greater systematic risk than the market portfolio.
B) stands little chance of surviving in the international financial market place.
C) has same returns as the market.
D) None of the above is true.
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