2/12/2020 Practice Quiz M5 (Ungraded)

My courses ▶ (20/01) MScFE 560 Financial Markets (C20-S1)

▶ Module 5: Stock and Equity Markets ▶ Practice Quiz M5 (Ungraded)

Started on Wednesday, 12 February 2020, 4:03 PM

State Finished
Completed on Wednesday, 12 February 2020, 4:07 PM
Time taken 4 mins 46 secs

Question 1

Complete

Not graded

What is the cost of equity from an issuing entity’s perspective?

Select one:
The rate of return the equity holders require.
Equal to the cost of debt where the equity/debt mix is 50/50.

The interest repayments on that share.

The risk you assume for taking on the share.

Your answer is correct.

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2/12/2020 Practice Quiz M5 (Ungraded)

Question 2

Complete

Not graded

Use the dividend growth model to determine the required rate of return for equity.
Your rm has just paid a dividend of $1.50 per share, has a recent price of $31.82
per share, and anticipates a growth rate in dividends of 4.00% per year for the
foreseeable future.

Select one:
9.09%
8.90%

There is not enough information to answer this question

8.71%

Your answer is correct.

Question 3

Complete
Not graded

What is the cost of equity from an issuing entity’s perspective?

Select one:
The interest repayments on that share.
Equal to the cost of debt where the equity/debt mix is 50/50.
The risk you assume for taking on the share.

The rate of return the equity holders require.

Your answer is correct.

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2/12/2020 Practice Quiz M5 (Ungraded)

Question 4

Complete

Not graded

Which kind of grouping is a stock index that represents only retailer stock
companies?

Select one:
Industry
Regional

Size
Geographic

Your answer is correct.

Question 5

Complete
Not graded

Which one of the following describes a value investor?

Select one:
They source their data for decision-making from numerous technical
charts.
They usually hold their investments for much shorter periods of time.
They are primarily forward-looking, as their valuations concern future cash
ows and future price growth.
They need to be very quick with their decision-making, as they are more
prone to higher uctuations in gains and losses.

Your answer is correct.

◄ Notes 4 M5
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2/12/2020 Practice Quiz M5 (Ungraded)

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