Modigliani and Miller each won a Nobel prize in economics in at least in part because of their work with capital structure. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Generally in the short run, a county’s actual output of goods and services increases the same rate as the country’s capacity. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
The contribution margin is defined as the percent of each sales dollar that remains after satisfying fixed operating costs. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
________ are financial creditors for the firm whereas ________ are the firm owners. A) Bankers; bondholders B) Bondholders; stockholders C) Stockholders; bondholders D) Stockholders; bankers ANSWER B
Date: September 19th, 2020
Which of the following is NOT a question related to the analysis of the overall economy? A) What is the current business cycle stage? B) How profitable is the industry cycle? C) How important are interest rates in the financial position of the firm within the industry? D) How easy is it to obtain debt […]
Date: September 19th, 2020
An increase in cost (fixed cost or variable cost) tends to increase the operating breakeven point, whereas an increase in the sales price per unit will decrease the operating breakeven point. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
A leveraged buyout (LBO) is when we tend to find firms at their lowest debt levels. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
A fixed-rate loan is a loan whose rate of interest is established at a fixed increment above the prime rate and is allowed to vary above the prime rate only when the prime rate varies until maturity. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
The overall goal in sizing up each external and internal factor is to increase the value of the firm. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Although more expensive than a line of credit, a revolving credit agreement can be less risky from the borrower’s viewpoint. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
