Net float equals A) disbursement float + collection float. B) the available balance − the firm’s book balance. C) disbursement float − collection float − the firm’s book balance. D) disbursement float − collection float. E) disbursement float + collection float − the firm’s available balance. ANSWER B
Date: September 19th, 2020
The delay between when you receive payment and when the bank gives you credit is called A) Disbursement Float B) Net Float C) Clearing Float D) Collection Float ANSWER D
Date: September 19th, 2020
The increased risk of doing business in a foreign country can be offset by: A) Lack of growth. B) Arbitrage. C) Diversification. D) Expropriation. ANSWER C
Date: September 19th, 2020
A(n) ________ is an annotation put on a checking account preventing funds on deposit that can be spent. A) Hold B) Stop C) Float D) ETF ANSWER A
Date: September 19th, 2020
________ can be found where cost of receivables is equal to the revenues from increased sales. A) Accounts payable B) Accounts receivable C) Optimal amount of credit D) Cost of extending credit ANSWER C
Date: September 19th, 2020
The increased risk of foreign investments is most often incorporated in capital budgeting models by A) international diversification. B) hedging with financial derivatives. C) reducing market risk. D) calculating certainty equivalents. E) adjusting the discount rate. ANSWER E
Date: September 19th, 2020
It is possible to reduce risk of the portfolio by adding a ________ risk investment if it is ________ correlated with other investments. A) high; negatively B) low; negatively C) high; positively D) low; positively ANSWER A
Date: September 19th, 2020
All of the following are possible complicating factors for evaluating foreign investments EXCEPT: A) Estimating foreign cash flows B) Little experience to draw on C) Lack of comparable firms D) New methods to learn ANSWER D
Date: September 19th, 2020
As the amount of credit extended increases, the ________ decreases. A) Optimal amount of credit B) Net cost of receivables C) Cost of receivables D) Revenues from increased sales ANSWER D
Date: September 19th, 2020
Why might a bank put a hold on a small personal check? A) Not wanting to disburse funds they have not yet received B) Requested by the payee C) Uncertain the check is good D) Prevent fraud ANSWER C
Date: September 19th, 2020
