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Question 77  interest tax shield

The equations for Net Income (NI, also known as Earnings or Net Profit After Tax) and Cash Flow From Assets (CFFA, also known as Free Cash Flow to the Firm) per year are:

###NI=(Rev-COGS-FC-Depr-IntExp).(1-t_c)###

###CFFA=NI+Depr-CapEx - \varDelta NWC+IntExp###

For a firm with debt, what is the amount of the interest tax shield per year?



Question 103  option

Below are 4 option graphs. Note that the y-axis is payoff at maturity (T). What options do they depict? List them in the order that they are numbered.

Image of option graphs



Question 151  income and capital returns

A share was bought for $30 (at t=0) and paid its annual dividend of $6 one year later (at t=1).

Just after the dividend was paid, the share price fell to $27 (at t=1). What were the total, capital and income returns given as effective annual rates?

The choices are given in the same order:

##r_\text{total}## , ##r_\text{capital}## , ##r_\text{dividend}##.



Question 302  WACC, CAPM

Which of the following statements about the weighted average cost of capital (WACC) is NOT correct?



Question 524  risk, expected and historical returns, bankruptcy or insolvency, capital structure, corporate financial decision theory, limited liability

Which of the following statements is NOT correct?



Question 583  APR, effective rate, effective rate conversion

A semi-annual coupon bond has a yield of 3% pa. Which of the following statements about the yield is NOT correct? All rates are given to four decimal places.



Question 615  debt terminology

You buy a house funded using a home loan. Have you or debt?


Question 640  option, future, no explanation

Which one of the below option and futures contracts gives the possibility of potentially unlimited gains?



Question 853  gross domestic product

Which form of production is included in the Gross Domestic Product (GDP) reported by the government statistics agency?



Question 867  limited liability, business structure

Which one of the following businesses is likely to be a public company in Australia, judging by its name?