ETS Corporate Finance Quiz #4
Please select one option for each question.
Question 1: a defense mechanism used by companies to make themselves less attractive to potential acquirers.
hostile takeover
posion pill
proxy fight
Question 2: a battle for control of a company's board of directors.
hostile takeover
posion pill
proxy fight
Question 3: The theory that financial markets reflect all available information and are therefore impossible to beat consistently.
efficient market hypothesis
Modigliani-Miller Theorem
Black-Scholes model
Question 4: a theory that states that the value of a firm is independent of its capital structure and that the cost of capital is based on the risk of the firm's assets, not the mix of debt and equity.
efficient market hypothesis
Modigliani-Miller Theorem
Black-Scholes model
Question 5: a method used to value options contracts, taking into account factors such as the underlying asset's price, the option's strike price, and the time to expiration.
efficient market hypothesis
CModigliani-Miller Theorem
Black-Scholes model
Question 6: when a company increases the number of its outstanding shares by issuing new shares to its existing shareholders.
A stock split
A dividend payout ratio
A stock dividend
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