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1) Walmart requires manufacturers to ship goods with RFID tags so it can better track
inventory and reduce the need for supply chain management.
2) The more short-term financing there is relative to long-term financing, the riskier the
financial structure.
3) Expected value techniques allow consideration of more than one possible outcome.
4) As the time horizon becomes shorter, more uncertainty enters the forecast.
5) Multinational firms tend to have a lower level of portfolio risk than comparable U.S.
firms.
6) If the acquiring firm's P/E ratio is greater than the P/E of the acquired firm, the
surviving firm will automatically get an increase in earnings per share.
7) Businesses will increasingly rely on B2B Internet applications to speed up the cash
flows through their firms.
8) A basic assumption in financial theory is that most investors and managers are risk
seekers.
9) An investor's preference for dividends rather than capital gains is influenced by their
level of income.
10) The higher the possible outcomes fall from the expected outcome of an investment,
the higher the risk and the lower the required rate of return by investors.
11) Paying dividends to common shareholders will not affect cash flows from financing
activities.
12) For corporations with low taxable income (less than $100,000), the effective tax
rate can be as much as 40%.
13) The market for U.S. government securities is the most efficient in the world.
14) Firms can almost always increase the amount of time they take to pay for purchases
without incurring problems.
15) The use of the optimum capital structure minimizes the cost of capital.
