Quiz Ch 04 – Identifying Non-issues with EVA
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
Which is NOT regarded as a concern or drawback associated with EVA?
Which is NOT regarded as a concern or drawback associated with EVA?
In what scenario will the utilization of financial leverage harm a firm’s Return on Equity (ROE)?
What will happen if a firm uses cash to pay off $50,000 in accounts payable when it has $600,000 in current assets and $150,000 in current liabilities?
Which would have the most adverse effect on a firm’s current ratio if the ratio is presently at 2?
If a company utilizes cash to clear some of its accounts payables, how will this impact its liquidity ratios when those ratios were already above 1 prior to the payment?
Which modification will result in an improvement in a firm’s Return on Equity (ROE)?
Given that a firm without any leases has a long-term debt ratio of 50%, what can be inferred about the book value of equity?
What does a cash ratio nearing 1.95 likely indicate for a company?
What does it indicate when a firm’s debt ratio surpasses 0.5?
What does it indicate when a firm’s quick ratio is equal to its current ratio?