In the search for profits, U.S. corporations have been forced to look beyond our country’s borders. All of the following contributed to the movement EXCEPT A) acceptance of the free market system in Third World countries. B) collapse of communism. C) information technology revolution. D) trade protectionism. ANSWER D
Date: September 19th, 2020
Which of the following securities will likely have the highest liquidity premium? A) Bbb-rated corporate bond maturing in 2020 actively traded on a major exchange B) U.S. Treasury bill C) U.S. Treasury bond maturing in 2027 D) Aaa-rated corporate bond maturing in 2015 not actively traded ANSWER D
Date: September 19th, 2020
This form of business organization does not distinguish between business and personal assets: A) sole proprietorship. B) limited liability corporation. C) general partnership. D) Both A and C ANSWER D
Date: September 19th, 2020
If we are able to fully diversify, what is the appropriate measure of risk to use? A) expected return B) risk-free rate of return C) beta D) standard deviation ANSWER C
Date: September 19th, 2020
You have contracted to buy a house for $250,000, paying $30,000 down and taking out a fully amortizing loan for the balance, at a 5.7% annual rate for 30 years. What will your monthly payment be if they make equal monthly installments over the next 30 years (to the nearest dollar)? A) $1,277 B) $1,189 […]
Date: September 19th, 2020
Rogue Corp. has sales of $4,250,000; the firm’s cost of goods sold is $2,500,000; and its total operating expenses are $600,000. The firm’s interest expense is $250,000, and the corporate tax rate is 40%. What is Rogue’s tax liability? A) $600,000 B) $360,000 C) $260,000 D) $258,000 ANSWER B
Date: September 19th, 2020
Tenth National Bank extended a $2 million loan to ABC Development Company. Tenth National accepted a mortgage on a building as collateral for the loan. The mortgagee’s signature on the loan, however, was a forgery. The resulting loss is covered by which financial institution bond coverage? A) Insuring Agreement A— Fidelity B) Insuring Agreement D—Forgery […]
Date: September 19th, 2020
A firm that is growing more slowly than its sustainable growth rate may generates excess cash. If the firm chooses to keep the excess cash which of the following is NOT true? A) Holding on to excess cash may signal OVER utilization of assets. B) Holding on to excess cash often is a negative stock […]
Date: September 19th, 2020
By definition, a lifestyle asset must depreciate over time. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
If a firm has a positive debt-equity ratio, and a positive tax rate, then then levered beta for the firm must be ________ the unlevered beta for the firm. A) less than B) greater than C) equal to D) Can not definitively answer this question. ANSWER B
Date: September 19th, 2020
