The CAPM has now become very widely accepted in global business as the preferred method of calculating the cost of equity for a firm
As a result of this, there is now little debate over what numerical values should be used in its application.
Indicate whether the statement is true or false.
Answer: FALSE
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The late Steve Jobs, co-founder of Apple, and Microsoft's Steve Ballmer present two different pictures of leaders
Jobs was a visionary and a "techie," a micromanager and a big-picture person. Ballmer is a good manager, although not a techie, and observers contend that he has been distracted lately from the company vision by litigation. How do these two men NOT fit the classic definition of top managers? What will be an ideal response?
Capital budgeting analyses typically assume a constant cost of capital, even though the analysts know it will change. One reason for this practice is that
A) the changes are too small to affect the decision. B) a constant cost of capital is the most conservative assumption. C) the changes are unpredictable. D) NPV calculations do not allow more than one discount rate.