$19.99 An ethics program is expected to have a ____
Found in Business: General-BusinessChapter 1, # 0
An ethics program is expected to have a ________ impact on the firm's share price.
Answer
|
|
a. |
Positive |
|
|
b. |
Negative |
|
|
c. |
No impact |
|
|
d. |
Undetermined |
Which of the following items cannot be found on a firm's balance sheet under current liabilities?
Answer
|
|
a. |
Accounts payable. |
|
|
b. |
Short-term notes payable to the bank. |
|
|
c. |
Accrued wages. |
|
|
d. |
Cost of goods sold. |
|
|
e. |
Accrued payroll taxes. |
Companies generate income from their "regular" operations and from other sources like interest earned on the securities they hold, which is called non-operating income. Lindley Textiles recently reported $12,500 of sales, $7,250 of operating costs other than depreciation, and $1,000 of depreciation. The company had no amortization charges and no non-operating income. It had $8,000 of bonds outstanding that carry a 7.5% interest rate, and its federal-plus-state income tax rate was 40%. How much was Lindley's operating income, or EBIT?
Answer
|
|
a. |
$3,462 |
|
|
b. |
$3,644 |
|
|
c. |
$3,836 |
|
|
d. |
$4,038 |
|
|
e. |
$4,250 |
Which of the following would indicate an improvement in a company's financial position, holding other things constant?
Answer
|
|
a. |
The inventory and total assets turnover ratios both decline. |
|
|
b. |
The debt ratio increases. |
|
|
c. |
The profit margin declines. |
|
|
d. |
The EBITDA coverage ratio declines. |
|
|
e. |
The current and quick ratios both increase. |
Chambliss Corp.'s total assets at the end of last year were $305,000 and its EBIT was 62,500. What was its basic earning power (BEP)?
Answer
|
|
a. |
18.49% |
|
|
b. |
19.47% |
|
|
c. |
20.49% |
|
|
d. |
21.52% |
|
|
e. |
22.59% |
Which of the following bank accounts has the highest effective annual return?
Answer
|
|
a. |
An account that pays 8% nominal interest with monthly compounding. |
|
|
b. |
An account that pays 8% nominal interest with annual compounding. |
|
|
c. |
An account that pays 7% nominal interest with daily (365-day) compounding. |
|
|
d. |
An account that pays 7% nominal interest with monthly compounding. |
|
|
e. |
An account that pays 8% nominal interest with daily (365-day) compounding. |
Suppose a State of California bond will pay $1,000 eight years from now. If the going interest rate on these 8-year bonds is 5.5%, how much is the bond worth today?
Answer
|
|
a. |
$651.60 |
|
|
b. |
$684.18 |
|
|
c. |
$718.39 |
|
|
d. |
$754.31 |
|
|
e. |
$792.02 |
Which of the following events would make it more likely that a company would choose to call its outstanding callable bonds?
Answer
|
|
a. |
The company's bonds are downgraded. |
|
|
b. |
Market interest rates rise sharply. |
|
|
c. |
Market interest rates decline sharply. |
|
|
d. |
The company's financial situation deteriorates significantly. |
|
|
e. |
Inflation increases significantly. |
The Morrissey Company's bonds mature in 7 years, have a par value of $1,000, and make an annual coupon payment of $70. The market interest rate for the bonds is 8.5%. What is the bond's price?
Answer
|
|
a. |
$923.22 |
|
|
b. |
$946.30 |
|
|
c. |
$969.96 |
|
|
d. |
$994.21 |
|
|
e. |
$1,019.06 |
Ezzell Enterprises' noncallable bonds currently sell for $1,165. They have a 15-year maturity, an annual coupon of $95, and a par value of $1,000. What is their yield to maturity?
Answer
|
|
a. |
6.20% |
|
|
b. |
6.53% |
|
|
c. |
6.87% |
|
|
d. |
7.24% |
|
|
e. |
7.62% |
Bill Dukes has $100,000 invested in a 2-stock portfolio. $35,000 is invested in Stock X and the remainder is invested in Stock Y. X's beta is 1.50 and Y's beta is 0.70. What is the portfolio's beta?
Answer
|
|
a. |
0.65 |
|
|
b. |
0.72 |
|
|
c. |
0.80 |
|
|
d. |
0.89 |
|
|
e. |
0.98 |
Tom O'Brien has a 2-stock portfolio with a total value of $100,000. $37,500 is invested in Stock A with a beta of 0.75 and the remainder is invested in Stock B with a beta of 1.42. What is his portfolio's beta?
Answer
|
|
a. |
1.17 |
|
|
b. |
1.23 |
|
|
c. |
1.29 |
|
|
d. |
1.35 |
|
|
e. |
1.42 |
The expected return on Natter Corporation's stock is 14%.The stock's dividend is expected to grow at a constant rate of 8%, and it currently sells for $50 a share. Which of the following statements is CORRECT?
Answer
|
|
a. |
The stock's dividend yield is 7%. |
|
|
b. |
The stock's dividend yield is 8%. |
|
|
c. |
The current dividend per share is $4.00. |
|
|
d. |
The stock price is expected to be $54 a share one year from now. |
|
|
e. |
The stock price is expected to be $57 a share one year from now. |
Gay Manufacturing is expected to pay a dividend of $1.25 per share at the end of the year (D1 = $1.25). The stock sells for $32.50 per share, and its required rate of return is 10.5%. The dividend is expected to grow at some constant rate, g, forever. What is the equilibrium expected growth rate?
Answer
|
|
a. |
6.01% |
|
|
b. |
6.17% |
|
|
c. |
6.33% |
|
|
d. |
6.49% |
|
|
e. |
6.65% |
The Isberg Company just paid a dividend of $0.75 per share, and that dividend is expected to grow at a constant rate of 5.50% per year in the future. The company's beta is 1.15, the market risk premium is 5.00%, and the risk-free rate is 4.00%. What is the company's current stock price, P?
Answer
|
|
a. |
$18.62 |
|
|
b. |
$19.08 |
|
|
c. |
$19.56 |
|
|
d. |
$20.05 |
|
|
e. |
$20.55 |
An investor who writes standard call options against stock held in his or her portfolio is said to be selling what type of options?
Answer
|
|
a. |
In-the-money |
|
|
b. |
Put |
|
|
c. |
Naked |
|
|
d. |
Covered |
|
|
e. |
Out-of-the-money |
- This tutorial was purchased 2 times and rated No Rating by students like you.
- Posted on Jul 10, 2012 at 3:02:58PM
gsdr.doc (80K)