Which one of the following firms common stocks is likely to


1. Which one of the following firms' common stocks is likely to have the lowest beta (i.e., systematic risk)?

A. Southwest Airlines (airline company)

B. Anaconda Steel (steel manufacturer)

C. Fiat Group (automobile manufacturer)

D. Dominion Power (electric utility)

2. Use of a profitability index to evaluate mutually exclusive projects in the absence of capital rationing:

A. will provide the same project rankings as an NPV criterion.

B. will provide the same project rankings as the payback period.

C. will provide the same project rankings as the return on invested capital.

D. can result in misguided project selections.

E. can result in proper project selections if used in conjunction with the IRR rule.

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Financial Management: Which one of the following firms common stocks is likely to
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