1. Which of the following variables is/are not required input(s) for parsimonious multiyear forecasting?
A) Net operating asset turnover (NOAT)
B) Net operating profits margin (NOPM)
C) Sales growth
D) Net nonoperating obligations (NNO)
E) All of the above are required inputs
2. Indicate which bond in the following pairs of bonds is to bear the higher likely interest rate (yield) and state why. If there is no general reason for a difference, indicate that they would be the same a.
a. A corporate bond rated Aaa or a municipal bond rated Aaa.
b. A municipal bond rated Baa or a municipal bond rated Aa
c. A general obligation bond issued by a city or a revenue bond issued by a city.
d. A general obligation bond rated Aa issued by a city or a general obligation bond rated Aa issued by a county.
e. A municipal bond (term) with maturity in five years or a municipal bond (term) with maturity in twenty years.
3. Which of the following would not be used as a summary performance measure when using market multiples to determine value?
A) Stock price
B) Net operating assets
C) Net operating profit after tax
D) Book value