Which of the following represents the correct ordering of standard deviation of returns over the period 1926 to 2014 (from highest to lowest standard deviation of returns)? A) common stocks, long-term government bonds, long-term corporate bonds, Treasury bills B) Treasury bills, long-term government bonds, long-term corporate bonds, common stocks C) Treasury bills, long-term government bonds, […]
You are going to pay $100 into an account at the beginning of each of the next 40 years. At the beginning of the 41st year you buy a 30 year annuity whose first payment comes at the end of the 41st year (the accounts earn 12%). How much will you receive at the end […]
Which of the following represents the correct ordering of returns over the period 1926 to 2014 (from lowest to highest return)? A) Treasury bills, common stocks, long-term corporate bonds, long-term government bonds B) Treasury bills, long-term government bonds, long-term corporate bonds, common stocks C) common stocks, long-term government bonds, long-term corporate bonds, Treasury bills D) […]
Which of the following statements about various types of surety bonds is true? A) A judicial bond guarantees that a public official will faithfully perform his or her duties for the protection of the public. B) A payment bond guarantees that the bonded person will appear in court. C) A license and permit bond guarantees […]
You are going to pay $800 into an account at the beginning of each of 20 years. The account will then be left to compound for an additional 20 years until the end of year 40, when it will turn into a perpetuity. You will receive the first payment from the perpetuity at the end […]
Which of the following statements about International Financial Reporting Standards (IFRS) is NOT true? A) IFRS offers simplicity but also possibly more leeway for accounting malpractice than does GAAP. B) In 2008, the Securities and Exchange Commission (SEC) announced its plan to convert U.S. companies from GAAP to IFRS. C) IFRS sets out broad and […]
Gremlin Media Inc. has realized tremendous growth in recent years. Last year the firm realized an ROE of 41.16%. If the firm was in a 40% marginal tax bracket, had an asset turnover ratio of 2.1, a profit margin of 14%, and a leverage ratio of 2, what was the firm’s retention ratio? A) 0.70 […]
Jack, owner of Jack’s Bar and Grill, was robbed while attempting to deposit receipts at his bank’s night depository. Jack had purchased an ISO commercial crime coverage form. This loss would be covered under which insuring agreement? A) Inside the Premises—Theft of Money and Securities B) Outside the Premises C) Money Orders and Counterfeit Currency […]
In the context of a surety agreement, the party who agrees to answer for the debt, default, or obligation of another party is called the A) principal. B) obligee. C) surety. D) fidelity. ANSWER Answer: C
National Bank believed it had been properly authorized to transfer $250,000 to the off-shore account of one of its corporate customers. The authorization was fraudulent, however, and the transferred funds were stolen. Under which commercial crime coverage insuring agreement would such a loss be covered? A) Money Orders and Counterfeit Currency B) Forgery or Alteration […]
