A _ contract is a private, tailored, bilateral agreement between two parties in which one party agrees to purchase, and the other to sell, a specified number of units of a specified asset at a given future date and at a specified price. a. swap b. forward c. futures d. warrant ANSWER B
Date: September 19th, 2020
Harry’s Sheds has ten different items in its finished goods inventory. The average number of units held in inventory and the average unit cost are listed for each item. The firm uses an ABC system of inventory control. (a) Which items should be considered to be in the A category of an ABC system of […]
Date: September 19th, 2020
Taizhou Products uses 800 units of a product per year on a continuous basis. The product has carrying costs of $50 per unit per year and order costs of $300 per order. It takes 30 days to receive a shipment after an order is placed and the firm requires a safety stock of 5 days […]
Date: September 19th, 2020
TRUE or FALSE: In Chapter 11 proceedings, the court almost always strictly adheres to the Absolute Priority Rule (APR). a. TRUE b. FALSE ANSWER B
Date: September 19th, 2020
Futures trading features daily _(i)_ in cash and _(ii)_. _(i)_ _(ii)_ a. closing marking-to-market b. resettlement closing c. resettlement marking-to-market d. swapping marking-to-market. ANSWER C
Date: September 19th, 2020
The total cost of a firm’s inventory is found by summing the ________. A) order cost and the marginal cost of a firm’s inventory B) order cost and the carrying cost of a firm’s inventory C) order cost and the actual cost of a firm’s inventory D) carrying cost and the marginal cost of a […]
Date: September 19th, 2020
According to signaling theory, Chapter 11 is a useful mechanism for screening inefficient firms out of debt renegotiation. Inefficient firms voluntarily choose Chapter 11 because: a. the firm can be liquidated more quickly. b. negotiations therein generally result in some value retained by shareholders. c. creditors are protected from violations of the absolute priority rule […]
Date: September 19th, 2020
Which of the following is an example of carrying cost? A) insurance of goods in transit B) transportation cost C) insurance cost D) cost of inventory ANSWER C
Date: September 19th, 2020
Investors who specialize in the debt or equity of distressed firms are called: a. speculators. b. arbitrageurs. c. bottom dwellers. d. vulture investors. ANSWER D
Date: September 19th, 2020
TRUE or FALSE: For distressed firms with both bank and public debt outstanding, banks never make concessions unless public debtholders also restructure their claims. a. TRUE b. FALSE ANSWER A
Date: September 19th, 2020
