Exam 1: Corporate Finance and the Financial Manager

You hold 1,000 units of Calgary Commercial Property,a real estate investment trust (REIT).500 of those units are held inside a tax-free savings account,the other 500 are outside the tax-free savings account.The REIT announces a profit of $10 per share,of which it retains $4 for reinvestment and distributes the rest as dividend payments.Given your personal tax rate of 30%,and the tax rate on dividends is 15%,what is your total after-tax income?

The financial manager of a well-regarded book publishing firm wishes to buy a small Internet publishing company to provide an avenue for sale of its materials online.In order to raise the funds to make this purchase,the financial manager decides to sell more stock in the company.How is the financial manager raising funds in this case?

Explain some of the measures taken to reduce the principal-agent problem.

What are the terms for the two types of prices quoted for a stock on an exchange?

Use the figure for the question(s) below. -What is the bid-ask spread on the stock shown above?

Companies that attract the interest of just a few investors are said to be

What is the term for the applicable price that the seller gets when he sells a stock on the exchange?

Put the following steps of the financial cycle in the correct order: I.Money flows to companies who use it to fund growth through new products. II)People invest and save their money. III)Money flows back to savers and investors.

Use the figure for the question(s) below. -Based on the information shown above,how much would you receive from selling 2000 shares of the above stock?

The principal goal of the financial manager is to maximize the wealth of the shareholders.

What are the main differences between a limited partnership and limited liability partnership?

What are the main differences between a partnership and sole proprietorship?

Windsor Windows earns $4.50 per share before taxes.The corporate tax rate is 30%,the personal tax rate on dividends is 15%,and the personal tax rate on non-dividend income is 40%.What is the total amount of taxes paid per share if the company pays a $2.00 dividend but all of the shares are held in a tax-free savings account?

What are the responsibilities of the board of directors?

Why do many Canadian companies list on the NYSE in addition to the TSX?

Which of the following would be best considered to be a principal-agent problem in the behaviour of the following financial managers?

Partnerships are the most common type of business firm in the world.

Which of the stock markets listed below is the smallest,as judged by trading volume?

The collection of all the outstanding shares of a corporation is known as the

Which of the following is typically the major factor in limiting the growth of a sole proprietorship?