1. In general, an increase in a liability is a source of funds.
True
False
2. The sustainable growth rate is the maximum growth rate achievable over an extended period of time.
True
False
3. An increase in financial leverage generally results in a higher return on equity (ROE).
True
False
4. The beta for the market as a whole equals 1.0.
True
False
5. The higher the opportunity cost of capital the higher the NPV.
True
False
6. A company's beta (from the CAPM) is affected by its capital structure.
True
False
7. An optimal current ratio should be greater than 1.0.
True
False