1. The dividend yield is the only return that a shareholder can expect from share ownership. True or False
2. The risk-free interest rate represents the return you can expect for taking no risk. True or False
3. The risk-free interest rate represents the return you can expect for taking no risk. True or False
4. What is the effective annual rate of 10.25% compounded continuously?
11.11%
10.86%
10.98%
11.04%
10.79%
5. Tello Company has 80,000 shares outstanding at $20 each. The company expects to raise $1,500,000 via a rights offering at a subscription price of $25. How many rights are required for each new share?
2.00 1.78 1.56 1.33 1.25