If a project's net present value (NPV) is zero, then its internal rate of return (IRR) will be:
You're trying to save enough money to buy your first car which costs $2,500. You can save $100 at the end of each month starting from now. You currently have no money at all. You just opened a bank account with an interest rate of 6% pa payable monthly.
How many months will it take to save enough money to buy the car? Assume that the price of the car will stay the same over time.
Suppose you had $100 in a savings account and the interest rate was 2% per year.
After 5 years, how much do you think you would have in the account if you left the money to grow?
Two risky stocks A and B comprise an equal-weighted portfolio. The correlation between the stocks' returns is 70%.
If the variance of stock A's returns increases but the:
- Prices and expected returns of each stock stays the same,
- Variance of stock B's returns stays the same,
- Correlation of returns between the stocks stays the same.
Which of the following statements is NOT correct?
Which of the following is NOT a valid method to estimate future revenues or costs in a pro-forma income statement when trying to value a company?
A firm is considering a business project which costs $11m now and is expected to pay a constant $1m at the end of every year forever.
Assume that the initial $11m cost is funded using the firm's existing cash so no new equity or debt will be raised. The cost of capital is 10% pa.
Which of the following statements about net present value (NPV), internal rate of return (IRR) and payback period is NOT correct?
"Buy low, sell high" is a phrase commonly heard in financial markets. It states that traders should try to buy assets at low prices and sell at high prices.
Traders in the fixed-coupon bond markets often quote promised bond yields rather than prices. Fixed-coupon bond traders should try to:
An Apple (NASDAQ:AAPL) stock was purchased by an investor for $120 and one year later was sold for $150. A dividend of $4 was also collected at the end of the year just before the stock was sold.
Which of the following statements about the stock investment is NOT correct? Ignore taxes.
Over the year, the investor made a:
.
Question 880 gold standard, no explanation
Under the Gold Standard (1876 to 1913), currencies were priced relative to: