1 Whatshould be the primary goal of the Chief Financial Offi

1) Whatshould be the primary goal of the Chief Financial Officer (CPo) ofhice? the b) Trying to optimise the Capital Structure o the above Trying to maximize the ROE 2) Company A is just similar to Company B. Beta of B is 2.Bis50% equity financed. Ass all equity financed. What is the Beta of A a), Beta of A should certainly be higher than 2 Beta of A should generally be higher than 2 d) Beta of A should generally be lower than 2 3) Which of t he following is the best description of the Bird in the Hand theory? a) De finite dividend payments each year is the best dividend policy b) A company should first dividends if anything is left from the profit There is no clear dividend policy for firms so shares owned are the real birds caught, Le policies maximizing share value are the best make all the important investments and only then pay c) d) None of the above a) debt to equity ratio b) fixed payments to variable payments ratio d) None of the above c) debt to total liabilities ratio 5) \"If a company is all equity financed (does not have any debts to outside sources), its ROE should be equal to its ROCE a) True b) False (We cannot generalize Which of the following financial documents are forecasted first in the Financial Planning of a company? 6) a) Pro forma Balance Sheet first b) d) Pro forma Cash Flows statement first Pro forma Ledgers Pro forma Income Statement first 7) Which of the following starts first? a) financial planning b) financial control c) they start simultaneously 8) If the optimal capital structure is met, beta of the company should be equal to? a) 1 b) 0 c) we cannot know d) less than 1 for sure 9) According to the empirical findings, what does happen to a company\'s share the company unexpectedly announces high dividend payments for the years a) share price increases b) share price decreases c) empirical results are mixed, we cannot generalize d) share price first increases but after the dividends are paid it decrease

Solution

All of the above is right answer as all are important

2 B is right since the nce type of debt also matters

3 None of the above as none of the statements reflect reality of what the theory means

4 A is right It refers to debt to equity or debt to capital ratio

Can answer only 4 parts according to Chegg policy