課程名稱︰財務管理
課程性質︰國企系大二必修
課程教師︰陳聿宏
開課學院：管理學院
開課系所︰國際企業學系
考試日期（年月日）︰2018/4/23
考試時限（分鐘）：150分鐘
試題 :
Financial Management (IB2012)
Midterm Exam
I: Multiple Choice (30 points in total; 3 points each).
Always choose single the answer that you feel is most correct or appropriate. For each question, write your answer in the gray square.
1. When a corporate fails, the maximum that can be lost by an individual shareholder is:
A. the amount of their initial investment.
B. the amount of their share of the profits.
C. their proportionate share required to pay the corporation's debts.
D. the amount of their personal wealth.
2. If interest is compounded semi-annually rather than annually, then:
A. future values and present values will both be higher.
B. future values and present values will both be lower.
C. future values will be lower and present values will be higher.
D. future values will be higher and present values will be lower.
3. Which of the following projects would you feel safest in accepting? Assume the opportunity cost of capital to be 12% for each project.
A. "A" has a small, but negative, NPV.
B. "B" has a positive NPV when discounted at 10%.
C. "C's" cost of capital exceeds its rate of return.
D. "D" has a zero NPV when discounted at 14%.
4. When is it appropriate to include sunk costs in the evaluation of a project?
A. Whenever they are relatively large
B. If they improve the project's NPV
C. If they are considered to be overhead costs
D. Never
5. The present value of the depreciation tax shield at any given discount rate is:
A. equal for all depreciation methods.
B. higher with MACRS than with straight-line depreciation.
C. higher for the 7-year recovery period than for the 5-year recovery period class.
D. likely to increase annually due to inflation.
6. The purpose of sensitivity analysis is to show:
A. the optimal level of capital expenditures.
B. how price changes affect break-even volume.
C. seasonal variation in product demand.
D. how variables in a project affect profitability.
7. Which one of the following is most likely for a CCC-rated bond, compared to a BBB-rated bond?
A. The CCC bond will have a variable-coupon rate.
B. The CCC bond will have a shorter term.
C. The CCC bond will have a higher promised yield to maturity.
D. The CCC bond will have a higher price for the same term.
8. A "convertible bond" provides the option to convert:
A. a bond into shares of common stock.
B. fixed-rate coupon payments into variable-rate payments.
C. a zero-coupon bond to a coupon-paying bond.
D. a junk bond to a zero-coupon investment-grade bond.
9. With respect to the notion that stock prices follow a random walk, many researchers have concluded that:
A. stock prices reflect a majority of available information about the firm.
B. successive price changes are predictable.
C. past stock prices provide little useful information about future stock prices.
D. stock prices always rise excessively in January.
10. Which statement is correct?
A. When stock prices barely change for a while, they are said to be stuck in a "bubble".
B. Bubbles can result when prices rise rapidly and investors believe prices will continue to rise.
C. Most bubbles with hindsight can be justified by the improved fundamentals.
D. "Bubbles" is another term for stocks in high-tech industries.
II: Free Response (70 points in total).
Question 1 (10 points, 5 points each)
You plan to retire in 30 years and want to accumulate enough by then to provide yourself with $100,000 a year in real dollars for 3 years. For simplicity, we assume that the payments occur at the end of every year. You believe that the interest rate is 10% and annual inflation rate is 6%.
(編按：題目真的前面寫30年後面寫3年……)
a. What is the real interest rate?
b. What is the real amount of savings that you need to accumulate by the time you retire?
Question 2 (10 points, 5 points each)
Company Alpha has $1 million allocated for capital expenditures. The opportunity cost of capital for each project is 11%.
Project Investment NPV IRR
($ thousands) ($thousands) (%)
1 300 66 17.2
2 200 -4 10.7
3 250 43 16.6
4 100 14 12.1
5 100 7 11.8
6 350 63 18.0
7 400 48 13.5
a. Which of the following projects should the company accept to stay with the $1 million budget?
b. How much does the budget limit cost the company in terms of its market value?
Question 3 (10 points, 5 points each)
Company Beta needs a new lathe. It can buy a new high-speed lathe for $1,200,000. The lathe will cost $100,000 per year to run, but it will save the firm $600,000 in labor costs and will be useful for 5 years. Suppose that the lathe will be depreciated on a straight-line basis over its 5-year life to salvage value of $200,000. After 5 years, the actual market value of the lathe at that time (in year 6) will be $250,000. The discount rate is 10%, and the corporate tax rate is 40%.
a. Calculate the net cash flow in year 3 of the project.
b. Calculate the net cash flow in year 6 of the project.
Question 4 (10 points, 5 points each)
Company Gamma can produce keepsakes that will be sold for $120 each. The annual sales revenue are $12,000. Non-depreciation fixed costs are $3,000 per year, and variable costs are $70 per unit. The firm pays no taxes, and the discount rate is 10%.
a. What is the accounting break-even level of sales?
b. What is the degree of operating leverage? If sales increase by 10%, what will be the percentage change in pretax profits?
Question 5 (10 points, 5 points each)
Consider two bonds, a 5-year bond paying annual coupons of 5% and a 5-year zero-coupon bond. Both bonds yield 5%.
a. Suppose interest rates increase from 5% to 6%. Will the coupon bond suffer the small percentage decline in price than the zero-coupon bond? Why or why not? Explain.
b. For the zero-coupon bond, what will be the percentage change in bond price for a 1 percentage-point change in yield?
Question 6 (10 points, 5 points each)
Company Delta has a book value per share of $25 this year. Suppose that it will generate a return on this book value of 20%. Management is expected to maintain a payout ratio of 60% of all earnings. Investors require a 10% rate of return on stocks facing the same risks as Company Delta.
a. What is the stock price in a dividend discount model?
b. What is the present value of growth opportunities?
Question 7 (5 points)
Is it possible that a yield curve is negative-sloping? Why or why not? Explain.
Question 8 (5 points)
"The efficient-market hypothesis is nonsense. Look at mutual fund Epsilon; it has beat the market and had superior performance for each of the last 10 years." Does the speaker have a point? Discuss.
選擇題答案：1. ADDDB 6. DCACB