Financial ratios that measure the firm’s ability to pay its bills over the short run without undue stress are known as:

A firm is expected to pay a dividend of $12 per share any day now. This dividend, along with the firm’s earnings, are expected to grow at a rate of 4% forever. If the current market price for a share is $67, what is the cost of equity?

Abaco Industries has bonds outstanding with a 6% coupon rate (APR) and a market price of $850. If the bonds mature in 5 years and interest is paid semi-annually, what is the YTM (as an APR) of those bonds?

Calculate the NPV of the following project using a discount rate of 5%:       Yr 0 = –$800; Yr 1 = –$80; Yr 2 = +$200; Yr 3 = +$300; Yr 4 = +$500; Yr 5 = +$500

Suppose that your firm has a cost of equity of 12% and a cost of debt of 6%. If the target debt/equity ratio is 0.60, and the tax rate is 30%, what is the firm’s weighted average cost of capital (WACC)?

In order to help you through college, your parents just deposited $25,000 into a bank account paying 5% interest. Starting tomorrow, you plan to withdraw equal amounts from the account at the beginning of each of the next four years. What is the MOST you can withdraw annually?

What is the future value at the end of year 4 of the following set of cash flows? Assume an interest rate of 7%. Year                                 1                2                3                4          Cash Flow                    +$900         -$900         +$800           -800

According to the CAPM, what is the expected return on asset A if it has a beta of 1.2, the expected market risk premium is 15%, and the T-bill rate is 1%?

According to the CAPM, what is the expected return on asset A if it has a beta of 2.5, the expected market return is 7%, and the T-bill rate is 1%?

A project requires an initial investment of $26 million. The target D/E ratio is 1.5. Flotation costs for equity are 10% and flotation costs for debt are 3%. What is the true cost (in dollars) of the project when you consider flotation costs?