A firm has arranged for a lockbox system to reduce collection time of accounts receivable. Currently the firm has an average collection period of 43 days, an average age of inventory of 50 days, and an average payment period of 10 days. The lockbox system will reduce the average collection period by 3 days by […]
Date: September 19th, 2020
Most firms employ ________ funding strategy if their sales and investments in operating assets are constant. A) aggressive B) conservative C) permanent D) seasonal ANSWER C
Date: September 19th, 2020
A problem with the tender offer mechanism in a takeover is the . The term refers to a situation in which rational behavior by each individual shareholder results in shareholders as a group being worse off. If individual target shareholders (correctly) foresee that the value of their shares will be worth more after the takeover […]
Date: September 19th, 2020
The ________ financing strategy requires a firm to pay interest on excess funds borrowed but not needed throughout the entire year. A) aggressive B) conservative C) permanent D) seasonal ANSWER B
Date: September 19th, 2020
In a __ the bidder’s intention is to acquire the target and replace the target’s incumbent management, who vigorously resist the attempt. a. merger b. acquisition c. buyout d. hostile takeover ANSWER D
Date: September 19th, 2020
A __ occurs when a group of individuals uses cash to purchase the shares of a firm and takes ownership and control of the firm. a. buyout b. acquisition c. consolidation d. merger ANSWER A
Date: September 19th, 2020
The aggressive financing strategy is a ________ method while the conservative financing strategy is a ________ method. A) high-profit, high-risk; low-profit, low-risk B) high-profit, low-risk; low-profit, high-risk C) low-profit, high-risk; high-profit, low-risk D) low-profit, low-risk; high-profit, high-risk ANSWER A
Date: September 19th, 2020
In a _ merger, two firms that heretofore have been competitors in the same line of business combine. a. conglomerate b. vertical c. diagonal d. horizontal ANSWER D
Date: September 19th, 2020
A _ merger occurs between two firms that had been doing business in different stages of the production process in a given industry. a. conglomerate b. vertical c. diagonal d. horizontal ANSWER B
Date: September 19th, 2020
In economic conditions characterized by short-term interest rates which exceed long-term interest rates, the financing strategy which would maximize profits is ________ strategy. A) the aggressive B) the conservative C) the trade-off D) a seasonal ANSWER B
Date: September 19th, 2020
