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CTP Exam Dumps - Certified Treasury Professional

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Question # 4

ABC Company is considering investing in new production technology. ABC has projected that the investment would add $5,000,000 in additional operating profit and that the resulting balance sheet would show $7,000,000 in long-term debt and $11,000,000 in total equity. ABC has a 34% tax rate and a 10% WACC. Which of the following is the investment's EVA?

A.

$1,500,000

B.

$2,200,000

C.

$3,300,000

D.

$3,500,000

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Question # 5

A company's investment guidelines typically restrict all of the following EXCEPT:

A.

maturities of instruments that may be purchased.

B.

proportion of the portfolio invested in specific types of instruments.

C.

purchase of unrated securities.

D.

issuance of commercial paper.

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Question # 6

Which of the following is a typical overnight use of excess cash?

A.

Entering into a repurchase agreement

B.

Investing in Dutch auction preferred stock

C.

Purchasing a Treasury bill

D.

Purchasing a certificate of deposit

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Question # 7

Company ABC is experiencing an increase in bank fees due to its new international customers paying by check. Nearly 15% of all deposited items are international checks. Twenty percent of the company’s checks have 1 day of float. Sixty-five percent of the company’s checks are on-us items. The company has $300,000 of deposits each day. The company’s deposits consist of both cash and checks, split evenly. On a typical day, how much of the deposit will be available immediately?

A.

$60,000

B.

$97,500

C.

$195,000

D.

$247,500

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Question # 8

Contingency plans often focus on the business supply chain, ensuring that customer service is maintained. The financial supply chain, which is equally critical to the plan, should address:

A.

supplier linkages.

B.

purchasing systems.

C.

working capital management.

D.

production resources.

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