If the expected rate of return on a stock exceeds the required ...

[s.tung]

If the expected rate of return on a stock exceeds the required rate:
 
  A) The stock is experiencing supernormal growth.
  B) The stock should be sold.
  C) The company is probably not trying to maximize price per share.
  D) The stock is a good buy.
  E) Dividends are not being declared.

Question 2

A U.S.-based multinational corporation (MNC) currently has an investment portfolio that includes
  Japanese securities valued at 10,000,000 yen. The company also owes its Japanese suppliers
  12,000,000 yen.
 
  Which of the following statements is MOST correct?
  A) The MNC will be exposed to exchange rate losses if the yen increases in value relative to the
  dollar.
  B) The MNC will be exposed to exchange rate losses if the yen declines in value relative to the
  dollar.
  C) The MNC is not exposed to exchange rate risk because it holds both assets and liabilities
  denominated in yen.
  D) The MNC can avoid exchange rate risk by paying its Japanese liabilities with dollars.

[medine]

Answer to Question 1

D

Answer to Question 2

A

[s.tung]

Thank you

[medine]

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