The Following Information Is Provided for the Delta Corporation (Amounts

question 18

Multiple Choice

The following information is provided for the Delta Corporation (amounts are in millions) :
-Refer to the information above. Forecast the 2009, 2010, and 2011 operating cash flows for Delta Corporation.

• A)2009: $1.9; 2010: $2.4; 2011: $2.8
• B)2009: $2.7; 2010: $2.8; 2011: $2.8
• C)2009: $2.7; 2010: $2.2; 2011: $2.8
• D)2009: $0.9; 2010: $1.2; 2011: $1.4

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Definitions:

Corporate Tax Rate

The tax imposed on the net income of a corporation, with the rate varying by country and sometimes also by the level of income earned.

Capital Component

One of the elements of a company's capital structure, such as equity or debt, which represents sources of financing.

Underlying Security

A stock, bond, commodity, or other asset upon which options and other derivatives are based or derived.

Preferred Stock

A class of ownership in a corporation that has a higher claim on assets and earnings than common stock, usually with fixed dividend payments.