Finance

The author presents evidence that recently Southwest Airlines had a ne

The author presents evidence that recently Southwest Airlines had a negative working capital gap. Which of the following reasons is likely to be primarily responsible for this enviable situation. A) Southwest borrows a lot of money short-term thus keeping their borrowing costs low. B) Southwest receives payment from customers in advance of most flights. C) […]

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Date: September 19th, 2020

Stage 1 of the industry life cycle is characterized by all of the foll

Stage 1 of the industry life cycle is characterized by all of the following EXCEPT: A) there is little demand for the company’s products and services. B) the firm’s revenue is low but there are high prospects for growth. C) competition is fierce and profit margins begin to narrow. D) firms need a significant amount […]

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Date: September 19th, 2020

Which of the following statements is NOT correct? Under conditions of

Which of the following statements is NOT correct? Under conditions of perfect capital markets: A) investors do not pay taxes, but firms do. B) firms do not pay taxes, but investors do. C) capital structure matters because it can change the value of the firm. D) capital structure does not matter because it cannot change […]

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Date: September 19th, 2020

An industry analysis is critical to better understand a firm’s financi

An industry analysis is critical to better understand a firm’s financial position because: A) it provides insight into how the firm’s financial needs might change as industry conditions change. B) it helps identify the key risks and opportunities facing the firm. C) it provides better insight into how maximize the firm’s current financial position relative […]

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Date: September 19th, 2020