An investment that pays higher than average dividends is called a(n) [{Blank}] stock. A. blue chip B. income C. micro cap D. midcap E. penny | Homework.Study.com (2024)

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• A stock issued by a company that has a capitalization of $300 million or less is called a [{Blank}] stock. A. blue chip B. income C. micro cap D. midcap E. penny
• A safe investment that generally attracts conservative investors is called a(n) [{Blank}] stock. A. blue chip, B. income, C. micro cap, D. midcap, E. penny.
• True or false? Stocks in companies that pay lower than average dividends are called income stocks.
• Does the Sensex value throw light on the average stock market return, or is it just a picture of the investment sentiment in the stock market?
• The stock was purchased five years ago for a price of $100. today at the end of five years it is worth $170. What is the average capital gains yield?
• An investor decided to put $205,990 in a fund tracking the DJIA. The settlement price for the mini Dow maturing in December is 20599 while the Dow is at 20968 today. The average and standard deviation
• Do I need a mid-cap index fund in my investment portfolio if I already have large-cap and small-cap index funds? I am a young passive long-term investor.
• Suppose you find that prices of stocks before large dividend increases show on average consistently positive abnormal returns. Is this a violation of the EMH?
• Suppose you find that prices of stocks before large dividend increases show on average consistently positive abnormal returns. Is this a violation of the EMH? Explain.
• [{Blank}] result in what is known as treasury stock. A)Stock dividends B)Stock repurchases C)Stock splits D)Reverse stock splits
• Tinker Co. owns 25% of the common stock of Harbor Co. and uses the equity method to account for the investment. During 2011, Harbor reported income of $120,000 and paid dividends of $40,000. Harbor ow
• The cost of retained earnings is: A) the cheapest B) zero because the firm does not have to pay interest or dividends itself C) always less then the common new stock D) typically cheaper then the cost of preferred stock
• What are 10 blue-chip stocks that we can hold for the long term and expect decent returns around 15%?
• Sharpe's Electronic Store has 825,000 shares of common stock outstanding with a market price of $40 a share. The company also has 65,000 bonds outstanding that are quoted at 106% of face value. When the weighted average cost of capital is calculated, what
• Rotari Holdings Ltd., an investment company has invested in equity shares of a blue chip company. Its risk free return (Rd) = 9%, Expected total return (Rm) =16%. Market sensitivity index (Bi) = 0.8.
• If the stock you bought at the beginning of 2007 for $65 per share grew to $126 by the end of 2012, what is the annualized rate of return (geometric average) of your stock during this period?
• You are considering investing $800. You can buy common stock at $25 per share; this stock pays no dividends. You can also buy a convertible bond ($1000 par value) that is currently trading at $790 and
• Evaluate: IPOs should be underpriced by about 10-15%, because the average rate of return on the stock market is about 10-15%, too.
• Whispering Vines, Inc. is all-equity-financed. The expected rate of return on the shares is 12%. Calculate the opportunity cost of capital for an average-risk Whispering Pines investment. Next, suppos
• What are the best values in P/B, EPS, ROE, ROCE, P/E for long term investing?
• The Dow Jones Industrial Average (DJIA) is computed by: a. adding the prices of 30 large "blue-chip" stocks and dividing by 30. b. calculating the total market value of the 30 firms in the index and dividing by 30. c. adding the prices of the 30 stocks
• Mutual funds that invest in lesser-known companies with a market capitalization of $2-$10 billion are called __________ funds. A. mid-cap B. large-cap C. microcap D. small-cap
• In terms of IPO investing, what does it mean to flip a stock? According to the empirical results regarding short and long-term returns that follow equity offerings, is flipping a wise investment strategy?
• You want to evaluate a company's stock which is experiencing higher than average growth rate in earnings. What is the intrinsic value of the stock today?
• Would the share value of a penny stock increase drastically if I were to (theoretically) invest 1 million dollars in it?
• A firm with excess cash and few investment alternatives might logically: a) declare a stock dividend. b) repurchase some of its own shares. c) choose to issue preferred stock.
• Mutual funds that follow a momentum trading strategy are known on Wall Street as momos. How might a mutual fund manager use a momentum trading strategy? Why might the fund manager expect to earn an above-average return? 2. What is behavioral finance? H
• Stock price on Dec 31, 2014$60.00 Number of common shares outstanding on Dec 31, 20141,000 What was Joe's average, or effective tax rate in 2014? Joe's Fly-by-Night Oil INCOME STATEMENT, 2014BALANCE SHEET, as of Dec 31, 2014 Sales$10,000ASSETS
• Money Penny Bank has an issue of preference shares with a fixed dividend of $6 that just sold for $94. What is the bank's cost of preference shares?
• The stock price of Bravo Corp. is currently $180. The stock price a year from now will be either $305 or $125 with equal probabilities. The interest rate at which investors invest in riskless assets i
• The stock price of Bravo Corp. is currently $105. The stock price a year from now will be either $175 or $70 with equal probabilities. The interest rate at which investors invest in riskless assets is
• Boring Unreliable Gadget Inc.'s stock price, S, is $50 today. It pays dividends of $1, after two months, and $1.05 after five months. The continuously compounded interest rate is 4% per year. Transact
• Investing: Why would one care about the moving average of a stock market index over the raw value of the index itself?
• Over a 20-year period an investment of $1,000 in common stocks returned an average of 11% in nominal terms and 4% in real terms. At the end of the 20 years, the portfolio value was $ [{Blank}] in nominal terms.
• According to fundamental analysis, which phrase best defines the par value of the common stock? O The liquidating value of the firm on a par share basis O The stocks current price in an inefficient market O The discounted value of all future dividends
• The cost of retained earnings is less than the cost of new outside equity capital. Consequently, it is totally irrational for a firm to sell a new issue of stock and to pay dividends during the same year. Discuss the meaning of those statements.
• Is Ujjivan Finance a good value stock to invest in?
• A highly conservative investor would be most likely to invest in a) common stock or penny stock. b) corporate bonds. c) preferred stock. d) government bonds.
• Following is the sequence of daily prices on the stock for the preceding month of June Estimate the historical volatility of the stock for use in the Black-Scholes-Merton model. (Ignore dividends on t
• State true or false and justify your answer: The use of common stock equity in the weighted average cost of capital is always (Ke) and not (Kn), the cost of new common stock.
• Telly, age 38, has a $140,000 IRA with Blue Mutual Fund. He has read good things about the management
• I have invested in small cap fund SIP (well known portfolio managers) since 18 months, despite sensex reaching 36500 mark, the fund is still in loss. What could be the reason?
• A stock index fund invests in a very large number of different stocks, so the return you get from it is roughly the average return for the stocks in the index. (a) Which of these two choices would g
• Is it okay to invest in low-expense ratio index funds with brokerage firms like TD Ameritrade, or am I supposed to only go with Vanguard?
• Is dollar-cost averaging a good way to limit investment risk in the stock market, when one is retired?
• You are deciding whether to add Bard Publishing to your portfolio, but you are concerned about your projection for their growth rate. Bard's cost of equity capital (the discount rate for equity) is known to be 9% and they just paid a dividend of $4.75 per
• Your parents spent $7,800 to buy 200 shares of stock in a new company 12 years ago. The stock has appreciated 14.6% per year on average. What is the current value of those 200 shares? a. $36,408.70 b. $40,023.03 c. $39,580.92 d. $40,515.08 e. $37,449.92
• True or False: The out-of-pocket cost of common stock is a good approximation of the cost of common stock equity.
• I've heard that Small Cap Value index funds beat the overall market over every 20 year period. Is that true? And is there a valid argument against a lean on Small Cap Value investing (say 25%) for you
• Will it be wise to invest in a company that has an enterprise value of 100mm and a market cap of 11mm? Can we call that a bargain or a valued investment?
• The stock price of Bravo Corp. is currently $125. The stock price a year from now will be either $210 or $85 with equal probabilities. The interest rate at which investors invest in riskless assets is 5%. Using the binomial OPM, the value of a put option
• | |Aggressive| Conservative | Investment in current assets| $28 |$34 | Amount in short term debt| $16| $10 | EBIT |$5.4 |$5.8 |Interest Rate -LTD (%) |12.0| 11.0 |Interest Rate-STD (%) |7.5| 7.0 F
• Your parents spent $7,800 to purchase 200 shares of stock in a new company 12 years ago. The stock has appreciated 14.6 percent per year on average. What is the current value of those 200 shares?
• What is the book value per share for a firm with 2 million shares outstanding at a price of $50, a market-to-book ratio of 0.75, and a dividend payout ratio of 50%?
• What is the book value per share for a firm with 2 million shares outstanding at a price of $50, a market-to-book ratio of .75, and a dividend-payout ratio of 50%? A. $33.33 B. $37.50 C. $62.50 D. $66.67
• You work for legendary stock genius Waffen Burrett and you think that the market is underestimating the stock price of Bank Euruni. In the market, the stock of Bank Euruni is trading at a PE ratio that is exactly the average of the PE of the following ban
• If I had INR 10 million to invest in Indian blue chip companies, what 4-5 stocks would you suggest? Why? I have 15k shares of Hindustan Unilever and want to rebalance my portfolio. I think HUL is beco
• Does the accelerator (YC/TechStars) "investment" set the fair market value of the common stock?
• If you bought stock using dollar cost averaging as listed here, what was your average cost? June 15 $50 1.75 shares July 15 $50 1.65 shares August 15 $50 2.00 shares
• IBM stock currently sells for $84 per share. Over 8 months the price will either go up by 7.5% or down by -3.0%. The risk-free rate of interest is 4.5% continuously compounded. What is the delta of a
• You own a stock portfolio invested 35 per cent in Stock Q, 25 per cent in Stock R, 25 per cent in Stock S, and 15 per cent in Stock T. The betas for these four stocks are 0.88, 1.21, 1.05, and 1.23, r
• You own a stock portfolio invested 15 per cent in Stock Q, 25 per cent in Stock R, 10 per cent in Stock S, and 50 per cent in Stock T. The betas for these four stocks are 1.68, 1.17, 1.76, and 0.46 re
• You own a stock portfolio invested 15 per cent in Stock Q, 25 per cent in Stock R, 30 per cent in Stock S, and 30 per cent in Stock T. The betas for these four stocks are 1.5, 0.4, 1.6, and 0.9, respe
• You own a stock portfolio invested 25 per cent in Stock Q, 25 per cent in Stock R, 20 per cent in Stock S, and 30 per cent in Stock T. The betas for these four stocks are 1.7, 0.6, 1.8, and 0.9, respe
• What is the delta of a nine-month at the money European call option on a non-dividend paying stock when the risk-free interest rate is 12% per annum, and the volatility of the stock is 18% per annum?
• You purchased 1,300 shares of LKL stock 5 years ago and have earned annual returns of 7.1%, 11.2%, 3.6%, -4.7%, and 11.8%. What is your arithmetic average return? a. 4.47% b. 5.80% c. 6.23% d. 6.47% e. 6.98%
• Stock in Parrot head Industries has a beta of 1.10. The market risk premium is 8 percent, and T-bills are currently yielding 5.5 percent. Parrot head's most recent dividend was $2.20 the best estimate of Parrot head's cost of equity?
• Assume that one year ago, you bought 270 shares of a mutual fund for $20 per share, you received an income distribution of $0.23 cents per share and a capital gain distribution of $0.38 cents per shar
• Assume that one year ago, you bought 200 shares of a mutual fund for $21 per share, you received an income distribution of $0.11 cents per share and a capital gain distribution of $0.32 cents per shar
• Calculate the delta of an at-the-money six-month European call option on a non-dividend-paying stock when the risk-free interest rate is 10% per annum and the stock price volatility is 25% per annum.
• If a portion of an investment is sold, the value of the shares sold is determined by using the: a) first-in, first-out method. b) average cost method. c) specific identification method. d) first-in, f
• Is value investing, based on fundamental analysis, a good option with a capital of 1.5 Lakh INR?
• 4. A mutual fund portfolio currently is worth $ 800 million. During the year, the fund sells stocks worth of 200 million and realizes the long term capital gains of $50 million. The fund uses all of t
• Tiny has preferred stock selling for 110.0 percent of par that pays an 9.8 percent annual coupon. What would be Tiny's component cost of preferred stock?
• Consider a stock paying continuous dividends of 1%. Assume r = 0.04, \sigma = 0.25 and today's stock price of S_0 = 30. You sell 100 Calls with strike K = 30 and expiration in 68 days (assume 365 days in a year). You also construct a delta-hedge to manage
• The delta of a call option on a non-dividend-paying stock is 0.4. What is the delta of the corresponding put option?
• Given the following information concerning four stocks, construct a simple price-weighted average, a value-weighted average, and a geometric average. Stock Price Number of Shares A$19 100,000 B $12
• Warren Buffet's strategy, related to his stock portfolio over the past several decades, was to buy U.S. "blue chip" companies, paying high dividends, and hold the position for the long term. Assess th
• The quote below is from John Bogle (former Chairman of Vanguard Investments) "The most fundamental decision of investing is the allocation of your assets: How much should you own in stock? How much i
• True or False? (1) The risk-free rate is the dividend paid by the by the most secure stock in the equity market. (2) To measure market risk of a stock, the Capital Asset Pricing Model uses the stand
• A venture with 2 million total common shares, (1.4 million owned by the entrepreneur and 0.6 million by an angel investor) had a post-money value of $8 million after it's last (and only) round of outs
• Suppose XYZ is a non-dividend-paying stock. The current stock price is S=$100, the volatility is s=35%, and the risk-free interest rate is r=1%. a) Using the Black-Scholes-Merton formula or the Black-
• Maximizing shareholder wealth means maximizing the A. market value of the firm's common stock. B. value of the firm's investments. C. value of the firm's cash. D. value of the firm's profits. E. value of the firm's assets.
• In a "perfect world" capital market, how important is a firm's decision to pay dividends versus repurchase shares? Under what conditions would you have a tax preference for share repurchase rather tha
• a. In a "perfect world" capital market, how important is a firm's decision to pay dividends versus repurchase shares? b. Under what conditions would you have a tax preference for share repurchase ra
• Parker Corporation has issued 3,000 shares of common stock and 500 shares of preferred stock for a lump sum of $ 124,000 cash. Calculate the allocation to common stock and preferred stock. A. The par
• Given: Anoi Inc. has the following equity accounts: 5%, $50 Par Preferred $3,600,000 Common Stock, $0.50 par value $165,320 Capital Surplus (PIC) 2,876,145 Retained Earnings 2,370,025 a. How many common shares are outstanding? b. What is the average
• Is Vanguard s Jack Bogle deceiving the masses regarding passive index funds when his own son runs an active management firm that Jack Bogle himself invests in?
• Should I start a SIP in an Indian mutual fund now or put my money into a liquid fund every month and wait for the Nifty P/E to reduce by earnings before I start?
• The current price of a non-dividend-paying stock is $30. Over the next six months, it is expected to rise to $36 or fall to $26. Assume the risk-free rate is zero What long position in the stock is necessary to hedge a short call option when the strike pr
• I have invested my money in ICICI prudential value discovery fund for an sip of Rs 1,000 per month. Is it a good fund for the long run or shall I switch?