The component cost of newly issued capital differs from the component cost of retained earnings in the following way

• A.The bond + premium approach doesn't work for new capital.
• B.Newly issued capital is usually issued at a lower par value than older existing common.
• C.Flotation costs are subtracted from the price received (P) in the calculation of (k).

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Which form of efficient market hypothesis assumes that all information is available to everyone at the same time?

• A.the strong form
• B.the semi-strong form
• C.the weak form

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The manufacturer of a sore throat spray claims that their product brings pain relief to sore throat sufferers within 5 seconds of contact. The manufacturer reported that for a random sample of 100 sore throat sufferers, the mean time of relief was 3.2 , seconds with a standard deviation of 1 second. Find the rejection region for the test if testing at z z0.01.

• A.t t0.01 = -3.18
• B.z z0.01 = -1.96
• C.z z0.01 = -2.33

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All of the below refer to the same party in an option transaction except:

• A.holder of a LONG option position
• B.option seller/writer
• C.holder of a SHORT option position

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The repurchase rate is 3.60% on a loan of 2 days for which $1,000,000 par value of a bond is sold to the lender at par. What is the repurchase price?

• A.$1,000,180
• B.$1,000,200
• C.$1,000,360

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