If the government regulates a natural monopoly and enforces an average cost pricing, what are the effects on output quantity and price compared to an unregulated natural monopoly?
A. Both are lower under average cost pricing.
Both are higher under average cost pricing.
C. One is higher and one is lower under average cost pricing.
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Which portion of an investment policy statement is most likely to state any restriction on portfolio leverage?
A. Procedures.
B. Investment guidelines.
C. Duties and responsibilities.
Zhou Lun, CFA, is an equity analyst who recently prepared a full report on BMM Corporation. The report included financial projections developed by Zhou Lun and information gathered from a third-party
A. No.
B. Yes,because the report relied on third-party research.
C. Yes,because the report was not properly disseminated.
Business risk is best described as resulting from the combined effects of a firms:
A. Financial risk and sales risk.
B. Sales risk and operating risk.
C. Operating risk and financial risk.
Faye Harlan, CFA, is estimating the cost of common equity for Cyrene Corporation. She prepares the following data for Cyrene:
·Price per share = $50.
·Expected dividend per shareFaye Harlan, CFA, is estimating the cost of common equity for Cyrene Corporation. She prepares the following data for Cyrene:
·Price per share = $50.
·Expected dividend per share
A. Dividend discount model approach.
B. Capital asset pricing model approach.
C. Bond yield plus risk premium approach.