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6. (3 points) Which one of the following is correct? A. A seasoned equity offering is a sale of newly issued equity shares by a firm that is now a privately-owned company B. Venture capitalists desire shares of common stock but avoid preferred stock. C. During a lock-up period, insiders are prohibited from providing forecasts or recommendations concerning security values. D. Firm Commitment is the most common type of underwriting method in the U.S. 7. (3 points) Consider the following put options. The risk-free interest rate is 6%. The stocks on which these options are written pay no dividends. Which put option is written on the stock with the time to expiration (T)? A. Put option A B. Put option B C. Both options have the same stock price D. Not enough information 8. (3 points) Which one of the following terms applies to an option that has an office building as its underiying asset? A. Financial option B. American option C. Put option D. Real option 9. (3 points) You are considering a project that has been assigned a discount rate of 15%. If you start the project today, you will incur an initial cost of $10,000 and will receive cash inflows of $5,700 a year for two years. If you wait one year to start the project, the initial cost will rise to $10,500, and the cash flows will increase to $6,500 each for the next two years. What is the value of the option to wait (or delay)? A. $551.03 B. $791.81 C. $800.01 D. $812.49 10. The length of time between the sale of inventory and the collection of the payment for that sale is called the following: A. Operating cycle. B. Inventory period. C. Accounts receivable period. D. Accounts payable period. E. Cash cycle

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