The market rewards firms that adopt a constant dividend payout policy rather than a fixed or increasing level of dividends through higher share prices. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
A firm that has an average age of accounts receivable that is significantly lower than the industry average: A) may have higher credit standards and offer credit to only the most highly qualified customers. B) may have credit terms that allow fewer days to pay before beginning to charge interest. C) may offer a larger […]
Date: September 19th, 2020
Which of the following statements is TRUE? A) The lower a firm’s debt-to-equity ratio, the LESS room it has to take on additional debt. B) More stable industries, such as utilities, tend to have LOWER debt-to-equity ratios. C) Leverage ratios focus on INCOME STATEMENT items. D) There is NO GENERAL BENCHMARK FOR LEVERAGE RATIOS, and […]
Date: September 19th, 2020
The level of dividends a firm expects to pay is generally unrelated to how rapidly it expects to grow as well as the level of asset investments required. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
________ is a measure of dispersion and is one way of measuring the risk of securities and portfolios. A) Diversification B) Expected return C) Standard deviation D) Statistics ANSWER C
Date: September 19th, 2020
Which of the following statements is NOT true regarding overall resource management? A) A firm would like to have as LITTLE money tied up in inventory as possible. B) A firm would like to receive payment from customers as QUICKLY as possible. C) A firm would like to generate as LITTLE revenue as possible for […]
Date: September 19th, 2020
All else equal, investors “like” ________ and “dislike” ________. A) risk; return. B) return; risk. C) standard deviation; risk. D) diversification; return. ANSWER B
Date: September 19th, 2020
Because dividends are taxed at the same rate as capital gains under the 2003 Tax Act, a firm’s strategy of paying low or no dividends primarily offers tax advantages to wealthy stockholders through tax deferral. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
If a firm has overdue liabilities or is legally insolvent or bankrupt, most states prohibit its payment of cash dividends. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
Working capital management is the management of: A) long-term debt. B) short-term assets and liabilities. C) capital assets and equity. D) short-term debt, long-term debt, and equity. ANSWER B
Date: September 19th, 2020
