Which of the following statements concerning private placements is MOST correct? A) Private placements do not involve investment bankers. B) More than half of all private placements are sold to federal, state, or local governments or government agencies. C) Although not selling the securities to the public, investment bankers may provide advice on the evaluation […]
Based on the information in Table 4-1, the OROA is A) 24.73%. B) 46.54%. C) 52.78%. D) 39.50%. ANSWER C
Jerry built a home in a flood plain. He did not purchase flood insurance. Recently, a noted meteorologist predicted torrential rains for the area for the next 7 days. Jerry attempted to purchase flood insurance through the National Flood Insurance Program. Which flood insurance provision is likely to block Jerry’s efforts to obtain coverage for […]
What does it mean to “maximize the value of the firm”? In general, how is value created? What factors determine value and how does each affect the value of the firm? What will be an ideal response? ANSWER To maximize the value of the firm most commonly means to maximize the market capitalization […]
A pro forma ________ forecasts the timing and amount of cash inflows and cash outflows. A) income statement B) balance sheet C) cash budget D) annual report ANSWER C
Which of the following statements is (are) true about the National Flood Insurance Program? I. You can’t purchase flood insurance through this program if your property is located in a high-flood-risk area. II. Coverage is not available for any property which has been flooded previously. A) I only B) II only C) both I and […]
Based on the information in Table 4-1, the debt ratio is A) 32.6%. B) 24.1%. C) 55.2%. D) 45.0%. ANSWER D
Generally accepted accounting principles (GAAP) require finance statements prepared on a cash basis because these statements are most useful for investors and managers. Indicate whether the statement is true or false ANSWER FALSE
Frank purchased a building in a run-down area of a city. When Frank was unable to obtain property insurance in the voluntary insurance market, an agent suggested that he contact a state pool created in the 1960s that makes property insurance available in riot-prone areas. The state pool the agent referred to is called a(n) […]
Which of the following are fundamental concepts that nonfinancial managers need to understand? A) How current business conditions can affect the firm’s performance. B) How to project financial statements and future investment needs. C) How capital markets work to raise long-term capital. D) All of the above. ANSWER D
