Corporate Finance Multiple Choice Questions Test

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Finance → Corporate Finance Multiple Choice Test Questions from 76 to 80

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76. The price of a stock is $100, and there are 40% chances that it would be $95 and 60% chances that it would be $115 the next year. What is the expected return?
(A) 5%
(B) 6%
(C) 7%
(D) 7.5%

77. A company’s agreement with the underwriter include
(A) spread
(B) greenshoe option
(C) A and B
(D) whiteshoe option

78. The long-run returns of Initial Public Offerings (IPOs) tend to __________ the market.
(A) underperform
(B) accelerate
(C) amplify
(D) none of these

79. Spread is __________ for IPOs.
(A) highest
(B) lowest
(C) average
(D) uncertain

80. The value of a financial derivative depends on the
(A) maturity
(B) duration
(C) forward interest rate
(D) underlying

ANSWERS: CORPORATE FINANCE MULTIPLE CHOICE QUESTIONS TEST
76. (C) 7%
77. (C) A and B
78. (A) underperform
79. (A) highest
80. (D) underlying