Which of the following is NOT a benefit provided by the existence of organized security exchanges? A) establishing and publicizing fair security prices B) standardization of all debt agreements C) helping businesses raise new capital D) providing a continuous market ANSWER B
Date: September 19th, 2020
Common-sized balance sheets show each account as a percentage of total sales to help analysts in comparing companies of difference sizes. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
Inputs using an Excel spreadsheet are almost identical to those on a financial calculator, except the interest rate is entered either as a decimal (.05 ) or a whole number followed by a % sign (5%) rather than simply a whole number (5 ) as you would enter using a financial calculator. ANSWER […]
Date: September 19th, 2020
An example of a secondary market transaction involving a capital market security is A) a new issue of a security with a very long maturity. B) the transfer of a previously-issued security with a very short maturity. C) a new issue of a security with a very short maturity. D) the transfer of a previously-issued […]
Date: September 19th, 2020
John invested $1,000 in a risky investment and Bill invested $1,000 in a less risky investment. One year later, Bill’s investment is worth $1,030. Which of the following statements is MOST correct? A) John’s investment must be worth more than $1,030 because of the risk-return trade-off, given that John’s investment was more risky. B) If […]
Date: September 19th, 2020
Operating return on assets is equal to the operating profit margin times total asset turnover. Indicate whether the statement is true or false ANSWER TRUE
Date: September 19th, 2020
The balance sheet equation is Total Assets = Total Revenues – Total Liabilities. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
In order to reduce agency problems, managers may be provided compensation that includes A) a fixed salary so managers’ pay is not at risk, allowing managers to focus on the company’s business. B) an option to buy the company’s stock. C) a bonus based on the level of profit achieved during the year. D) incentive […]
Date: September 19th, 2020
Financial intermediaries A) offer indirect securities. B) usually are underwriting syndicates. C) constitute the various secondary markets. D) include the national and regional stock exchange. ANSWER A
Date: September 19th, 2020
Total asset turnover is equal to accounts receivable turnover plus inventory turnover plus fixed asset turnover. Indicate whether the statement is true or false ANSWER FALSE
Date: September 19th, 2020
