All of the following are sources of political risk EXCEPT A) tax holidays. B) change in government. C) tariff increases. D) labor law changes. ANSWER A
Date: September 19th, 2020
All of the following are costs of credit EXCEPT A) bad debt losses. B) credit analysis expenses. C) lost revenues when customers do not take advantage of trade discounts. D) the increased investment in accounts receivable. ANSWER C
Date: September 19th, 2020
All of the following are part of the five “Cs” of credit analysis EXCEPT A) currency. B) capital. C) collateral. D) conditions. E) capacity. ANSWER A
Date: September 19th, 2020
The best source of information about a customer’s credit is/are A) the firm’s experience with the customer. B) Dun and Bradstreet. C) information from the customer’s bank. D) data from financial markets. E) credit references supplied by the customer. ANSWER A
Date: September 19th, 2020
An accounts receivable aging schedule is used to A) decide whether to extend credit. B) determine whether legal action should be taken against a customer with a past due account. C) provide information about whether the firm’s prices are too low. D) monitor accounts receivable. E) make decisions regarding the length of time a firm […]
Date: September 19th, 2020
Insisting the contracts be denominated in the U.S. dollar can help avoid ________. A) Exchange rate risk B) Arbitrage C) Political risk D) PPP ANSWER A
Date: September 19th, 2020
Which type of firm would benefit the most from a “basket” type of inventory management system? A) “Category-killer” office supply stores B) Aircraft manufacturers C) Defense contractors D) Public accounting firms E) Automotive manufacturers ANSWER D
Date: September 19th, 2020
When would the “return on equity” equal the “return on assets”? A) Whenever the debt to equity ratio is one B) Whenever the debt ratio is zero C) Whenever a firm has positive net worth D) Whenever the firm has positive net worth and positive net income ANSWER B
Date: September 19th, 2020
The inventory method that relies on deliveries coming right before they are needed is: A) Just-in-Time B) Basket C) LIFO D) FIFO ANSWER A
Date: September 19th, 2020
1 year ago $1 would buy 6.5 pesos. Today $1 buys 7.5 pesos. If the US had an inflation rate of 3%, calculate Mexico’s inflation rate. A) 3.1% B) 18.38% C) 4.2% D) 7.8% ANSWER B
Date: September 19th, 2020
