If a U.S. company enters into a purchase agreement with a European company and the contract is
denominated in euros, then direct exchange rate risk exists for both companies.
Indicate whether the statement is true or false
Question 2
AFB, Inc and DAS, Inc both paid a 2 per share dividend last year. This year, AFB, Inc announces
an increase to 3 per share while DAS, Inc announces an increase to 2.50 per share.
After the
announcement, the price of DAS, Inc stock increases and the price of AFB, Inc's stock decreases.
Which of the following best explains this situation?
A) Capital markets are perfect.
B) The stock market is irrational.
C) AFB, Inc. had higher agency costs than DAS, Inc. prior to the announcement.
D) Both companies need to raise capital for positive NPV projects, and flotation costs are high.
Inheritance of hemophilia in European royalty
Monstrous people from distant lands depicted in a fifteenth-century European woodcut.
When the United States gets stuck over a controversial issue—usually something a divided Congress ca
Christian Gladu, The Bungalow Company, The Birch, North Town Woods, Bainbridge
European Mistletoe