Matthews Corporation Has a Beta of 1

question 39

Multiple Choice

Matthews Corporation has a beta of 1.2.The annualized market return yesterday was 13%, and the risk-free rate is currently 5%.You observe that Matthews had an annualized return yesterday of 17%.Assuming that markets are efficient, this suggests that

• A)bad news about Matthews was announced yesterday.
• B)good news about Matthews was announced yesterday.
• C)no news about Matthews was announced yesterday.
• D)interest rates rose yesterday.

Calculate specific cash flow amounts, such as cash received from the sale of equipment or dividends received.

Understand how the cash flow statement is affected by changes in inventory, accounts receivable, and accounts payable.

Interpret the cash flow on total assets ratio to evaluate company performance.

Understand the components and format of the Statement of Cash Flows.

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Definitions:

Probability

The statistical likelihood that a specific event will take place, calculated as a fraction or a percentage between 0% (never happening) and 100% (always happening).

Normal Model

A statistical model, also called the normal distribution, that describes how continuous data is distributed, shaped like a symmetric bell curve.

Standard Deviations

Measures that quantify the amount of variation or dispersion of a set of data values from the mean.

Probability

The determination of how probable an event is, denoted as a number from 0 to 1.