Finance

Ted is risk manager of XYZ Company. He is concerned his company might

Ted is risk manager of XYZ Company. He is concerned his company might be sued by current or former employees alleging wrongful termination, failure to promote, racial or gender discrimination, or sexual harassment. What type of liability insurance can Ted purchase to cover these types of claims? A) workers compensation insurance B) employer liability insurance […]

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Date: September 19th, 2020

Holiday DeCor Company is insured by a commercial general liability pol

Holiday DeCor Company is insured by a commercial general liability policy (CGL). Holiday DeCor rented a storage facility for one month to store some excess inventory. While visiting the storage facility, a Holiday DeCor employee discarded a cigarette. The resulting fire severely damaged the storage facility. Which statement is true regarding coverage of this damage […]

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Date: September 19th, 2020

Medical malpractice insurance written on a claims-made basis can leave

Medical malpractice insurance written on a claims-made basis can leave a surgeon vulnerable to malpractice claims if the surgeon retires, changes insurers, or drops coverage. A provision can be added to the claims-made form that protects the surgeon for future claims arising from incidents that occurred while the claims-made policy was in force. This provision […]

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Date: September 19th, 2020

Which of the following statements concerning directors and officers li

Which of the following statements concerning directors and officers liability insurance (D&O) is (are) true? I. D&O policies usually cover the personal liability of directors and officers. II. D&O policies exclude coverage for claims brought by employees and by stockholders. A) I only B) II only C) both I and II D) neither I nor […]

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Date: September 19th, 2020

You are considering investing in Ford Motor Company. Which of the foll

You are considering investing in Ford Motor Company. Which of the following are examples of diversifiable risk? I. Risk resulting from possibility of a stock market crash. II. Risk resulting from uncertainty regarding a possible strike against Ford. III. Risk resulting from an expensive recall of a Ford product. IV. Risk resulting from interest rates […]

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Date: September 19th, 2020

Which of the following is NOT a disadvantage of a sole proprietorship

Which of the following is NOT a disadvantage of a sole proprietorship as a form of business organization compared to the corporate form of business organization? A) Access to the capital markets B) Unlimited liability of the owners C) Subject to the double taxation D) Limited liability of the shareholders     ANSWER D

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Date: September 19th, 2020

Why is the price/earnings ratio a common and popular technique for eva

Why is the price/earnings ratio a common and popular technique for evaluating stocks? Why do fast growing firms have higher P/E ratios? What is a long-run average P/E ratio for larger publicly traded firms in the United States? What are some limitations to using this technique to evaluate stock prices?     ANSWER P/E ratios […]

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Date: September 19th, 2020

An investor currently holds the following portfolio: Amount Invested

An investor currently holds the following portfolio: Amount Invested 8,000 shares of Stock A $16,000 Beta = 1.3 15,000 shares of Stock B $48,000 Beta = 1.8 25,000 shares of Stock C $96,000 Beta = 2.2 The investor is worried that the beta of his portfolio is too high, so he wants to sell some […]

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Date: September 19th, 2020