Financial Management - Study Mode

[#271] In expected rate of return for constant growth, capital gains is divided by capital gains yield to calculate
Correct Answer

(C) beginning price

Explanation

Solution: In expected rate of return for constant growth, capital gains is divided by capital gains yield to calculate beginning price. Beginning market value (BMV) is the valuation at which a property or investment should exchange at the date of origination, and then at the beginning of each subsequent period.

[#272] Stock which has fixed payments and failure of payments which do not lead to bankruptcy is classified as
Correct Answer

(B) preferred stock

Explanation

Solution: Stock which has fixed payments and failure of payments which do not lead to bankruptcy is classified as preferred stock. Preferred stock refers to a class of ownership that has a higher claim on assets and earnings than common stock has.

[#273] An efficient market hypothesis states all public information which is reflected in current market prices is classified as
Correct Answer

(D) semi strong efficiency

Explanation

Solution: An efficient market hypothesis states all public information which is reflected in current market prices is classified as semi strong efficiency. The semi-strong form efficiency is a type of efficient market hypothesis (EMH), which holds that security prices adjust quickly to newly available information, thus eliminating the use of fundamental or technical analysis to achieving a higher return.

[#274] In expected rate of return for constant growth, an expected dividend yield must be
Correct Answer

(B) constant

Explanation

Solution: In expected rate of return for constant growth, an expected dividend yield must be constant. The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR).

[#275] Value of stock as concluded with help of analysis by particular investor is classified as
Correct Answer

(D) Both B and C

Explanation

Solution: Value of stock as concluded with help of analysis by particular investor is classified as intrinsic value and fundamental value.