Which statement is true about medical expense coverage under the boatowners package policy? A) It pays the medical expenses of a covered person who is injured while in the boat. B) It pays the medical expenses of another boat operator who is injured as a result of negligent operation of the boat by the insured. […]
Date: September 19th, 2020
Which of the following statements is MOST correct concerning flotation costs? A) Flotation costs are the same for common stock, preferred stock and bonds because they reflect mainly printing costs and legal fees. B) Flotation costs are higher for common stocks than for preferred stocks and bonds due to the higher level of risk associated […]
Date: September 19th, 2020
Adding stocks to a bond portfolio will increase the riskiness of the portfolio because stocks have higher standard deviations of returns than bonds. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Which of the following statements is TRUE? A) Issuing equity automatically hurts existing shareholders. B) Equity is less expensive than debt because of the dividend tax shield found with equity. C) If a firm takes on a positive NPV project financed with new equity, existing shareholders will benefit. D) All of the above are true. […]
Date: September 19th, 2020
A company with negative net income will also have negative operating cash flow. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
You deposit $5,000 per year at the end of each of the next 25 years into an account that pays 8% compounded annually. How much could you withdraw at the end of each of the 20 years following your last deposit if all withdrawals are the same dollar amount? (The twenty-fifth and last deposit is […]
Date: September 19th, 2020
Assume you are to receive a 10-year annuity with annual payments of $1000. The first payment will be received at the end of Year 1, and the last payment will be received at the end of Year 10. You will invest each payment in an account that pays 9 percent compounded annually. Although the annuity […]
Date: September 19th, 2020
Andrea purchased an auto insurance policy with bodily injury liability limits of 250/500 ($250,000/$500,000). She also purchased a personal umbrella policy with a $1 million limit and a $500 self-insured retention. Andrea was talking on her cell phone while driving, and her car struck and killed a pedestrian in a crosswalk. The court ordered her […]
Date: September 19th, 2020
All of the following are ISO personal umbrella liability policy exclusions EXCEPT A) liability arising out of uncompensated board service for a nonprofit organization. B) liability arising out of expected or intentional injury. C) liability arising out of business operations. D) liability arising out of operation of watercraft not covered by an underlying policy. […]
Date: September 19th, 2020
You charged $1,000 on your credit card for Christmas presents. Your credit card company charges you 26% annual interest, compounded monthly. If you make the minimum payments of $25 per month, how long will it take (to the nearest month) to pay off your balance? A) 54 months B) 40 months C) 94 months D) […]
Date: September 19th, 2020
