So I am terrible at finance and worried about passing this class, if anyone can help me with any of the questions that I have posted below.. I would really appreciate it.. thanks for your time!!!

1.

Compensating managers with stock options can help reduce conflicts of interest between stockholders and managers, but if the options are all exercisable on a specific date in the near future, this can motivate managers to deceive stockholders, true or false?

A) True

B) False

2.

One example of an agency relationship is the one between stockholders and managers.

A) True

B) False

3.

Potential conflicts of interest can exist between stockholders and managers and also between stockholders and bondholders, true or false?

A) True

B) False

4.

What would the future value of $100 be after 5 years at 10% compound interest?

A) $161.05

B) $134.54

C) $127.84

D) $151.29

E) $143.65

5.

Suppose you have $2,000 and plan to purchase a 3-year certificate of deposit (CD) that pays 4% interest, compounded annually. How much will you have when the CD matures?

A) $2,324.89

B) $2,591.45

C) $2,249.73

D) $2,011.87

E) $2,854.13

6.

Suppose a U.S. government bond promises to pay $2,249.73 three years from now. If the going interest rate on 3-year government bonds is 6%, how much is the bond worth today?

A) $2,011.87

B) $2,591.45

C) $2,324.89

D) $1,888.92

E) $2,854.13

7.

What is the PV of an annuity due with 5 payments of $3,000 at an interest rate of 5%?

A) $11,110.34

B) $13,637.85

C) $12,513.68

D) $14,976.84

E) $15,349.15

8.

Superior Medical System's 2005 balance sheet showed total common equity of $2,050,000. The company had 100,000 shares of stock outstanding which sold at a price of $57.25 per share. By how much did the firm's market value and book value per share differ?

A) $36.75

B) $38.25

C) $39.50

D) $40.25

E) $51.00

9.

Fine Breads Inc. paid out $26,000 common dividends during 2005, and it ended the year with $150,000 of retained earnings. The prior year's retained earnings were $145,000. What was the firm's 2005 net income?

A) $30,000

B) $31,000

C) $32,000

D) $33,000

E) $34,000

10.

Use the following information for the questions 10-16.

The balance sheet and income statement shown below are for Byrd Inc, and the data are to be used for the following questions. Note that the firm has no amortization charges, it does not lease any assets, and none of its debt must be retired during the next 5 years (notes payable will be rolled over). Assume a 360-day year.

BALANCE SHEET (millions of dollars)

Cash

$ 140.0

Accounts payable

$ 800.0Accts. receivable

880.0

Notes payable

600.0Inventories

1,320.0

Accruals

400.0Total current assets

$2,340.0

Total current liabilities

$1,800.0

Long-term bonds

1,000.0

Total debt

$2,800.0

Common stock

200.0

Retained earnings

1,000.0Net plant & equip.

1,660.0

Total common equity

$1,200.0Total assets

$4,000.0

Total liabilities & equity

$4,000.0

INCOME STATEMENT (millions of dollars)

Net sales

$ 6,000.0Operating costs

5,599.8Depreciation

100.2EBIT

$ 300.0Less: Interest

96.0EBT

$ 204.0Less: Taxes

81.6Net income

$ 122.4

OTHER DATA

Shares outstanding (millions)

60.00Common dividends (millions)

$42.8Interest rate on N/P and long-term bonds

6.0%Federal plus state income tax rate

40%Year-end stock price

$30.60

What is the firm's current ratio?

A) 1.10

B) 1.20

C) 1.30

D) 1.40

E) 1.50

11.

What is the firm's quick ratio?

A) 0.25

B) 0.33

C) 0.41

D) 0.49

E) 0.57

12.

What is the firm's profit margin?

A) 2.04%

B) 2.16%

C) 2.28%

D) 2.40%

E) 2.52%

13.

What is the firm's cash flow per share?

A) $3.71

B) $3.86

C) $4.01

D) $4.16

E) $4.31

14.

What is the firm's P/E ratio?

A) 10.0

B) 12.5

C) 15.0

D) 17.5

E) 20.0

15.

What is the firm's book value per share?

A) $16.00

B) $17.00

C) $18.00

D) $19.00

E) $20.00

16.

What is the firm's market-to-book ratio?

A) 1.38

B) 1.53

C) 1.68

D) 1.83

E) 1.98

17.

Which of the following is an example of a capital market instrument?

A) Commercial paper.

B) Preferred stock.

C) U.S. Treasury bills.

D) Banker's acceptances.

E) Money market mutual funds.

18.

Money markets include

A) foreign currencies.

B) consumer automobile loans.

C) corporate stocks.

D) long-term bonds.

E) short-term debt securities such a Treasury bills.

19.

Most studies of stock market efficiency suggest that the stock market is efficient in the weak-form and efficient in the semistrong-form. Assuming these findings are correct, which of the following statements is true?

A) Information you read in The Wall Street Journal cannot be used to select stocks that are likely to produce above-average rates of return.

B) You have been tracking a stock's price over the past 6 months, and you note that this particular stock has tended to rise sharply immediately after it has fallen for three days. You can use this information to devise a trading strategy that will help you beat the market.

C) If you apply financial analysis properly, you can use information provided in companies' annual reports to earn above-average returns.

D) Even if you possess insider information, you cannot use this information to earn above-average returns because such information will already be reflected in stock prices.

E) You notice that a company's stock price always seems to swing back and forth--whenever it falls by 10% or more, it seems to recover and to eventually exceed its former high. Since its price has fallen during the past 2 months, now is a great time to buy it before it takes off again.

20.

If the Federal Reserve sells $50 billion of short-term U.S. Treasury securities to the public, other things held constant, what would be the most likely effect on short-term securities prices and interest rates?

A) Prices and interest rates will both rise.

B) Prices will rise and interest rates will decline.

C) Prices and interest rates will both decline.

D) Prices will decline and interest rates will rise.

E) There is no reason to expect a change in either prices or interest rates.

21.

Suppose 1-year Treasury bonds yield 3.0% while 2-year T-bonds yield 4.5%. Assuming the pure expectations theory is correct and thus the maturity risk premium is zero, what should the yield be on a 1-year T-bond one year from now?

A) 5.91%

B) 6.02%

C) 6.13%

D) 6.24%

E) 6.35%

22.

The Carter Company's bonds mature in 10 years have a par value of $1,000 and an annual coupon payment of $80. The market interest rate for the bonds is 9%. What is the price of these bonds?

A) $935.82

B) $941.51

C) $958.15

D) $964.41

E) $979.53

23.

Ken Williams Ventures' recently issued bonds that mature in 15 years. They have a par value of $1,000 and an annual coupon of 6%. If the current market interest rate is 8%, at what price should the bonds sell?

A) $801.80

B) $814.74

C) $828.81

D) $830.53

E) $847.86

24.

Brown Enterprises' bonds currently sell for $1,025. They have a 9-year maturity, an annual coupon of $80, and a par value of $1,000. What is their yield to maturity?

A) 6.87%

B) 7.03%

C) 7.21%

D) 7.45%

E) 7.61%

25.

T. Martell Inc.'s stock has a 50% chance of producing a 30% return, a 35% chance of producing a 9% return, and a 15% chance of producing a 25% return. What is Martell's expected return?

A) 21.9%

B) 15.2%

C) 16.0%

D) 16.8%

E) 17.6%

26.

An investor has a 2-stock portfolio with $50,000 invested in Palmer Manufacturing and $50,000 in Nickles Corporation. Palmer's beta is 1.20 and Nickles' beta is 1.00. What is the portfolio's beta?

A) 0.94

B) 1.02

C) 1.10

D) 1.18

E) 1.26

27.

Magee Company's stock has a beta of 1.20, the risk-free rate is 4.50%, and the market risk premium is 5.00%. What is Magee's required return?

A) 10.25%

B) 10.50%

C) 10.75%

D) 11.00%

E) 11.25%