Financial literacy

Which of the following statements regarding portfolio standard deviation is accu

Which of the following statements regarding portfolio standard deviation is accurate? The higher the coefficient of correlation between the securities in the portfolio, the greate…

Which of the following statements regarding preferred stock is true? Holders of

Which of the following statements regarding preferred stock is true? Holders of preferred stock have the same voting rights as common stockholders Preferred stock dividend payment…

Which of the following statements regarding preferred stock is true? Holders of

Which of the following statements regarding preferred stock is true? Holders of preferred stock have the same voting rights as common stockholders Preferred stock dividend payment…

Which of the following statements regarding stock trading is INCORRECT? A. Stock

Which of the following statements regarding stock trading is INCORRECT? A. Stock that has priority for dividends and bankruptcy liquidation is called equity stock.    B. Proxy vot…

Which of the following statements regarding the effects of translation on financ

Which of the following statements regarding the effects of translation on financial statement items/ratios is most accurate? A)Leverage is higher under the current rate method as …

Which of the following statements regarding the efficient market hypothesis is N

Which of the following statements regarding the efficient market hypothesis is NOT accurate? Select one: a. If the market is weak form efficient, then investors cannot earn abnorm…

Which of the following statements regarding the functional currency under US GAA

Which of the following statements regarding the functional currency under US GAAP is least accurate? A)Self-contained, independent subsidiaries whose operations are primarily loca…

Which of the following statements regarding the valuing of costs and benefits is

Which of the following statements regarding the valuing of costs and benefits is NOT? correct? A. Competitive market prices allow us to calculate the value of a decision without w…

Which of the following statements regarding the valuing of costs and benefits is

Which of the following statements regarding the valuing of costs and benefits is not correct? In the absence of competitive markets, we can use one - sided prices to determine exa…

Which of the following statements regarding the valuing of costs and benefits is

Which of the following statements regarding the valuing of costs and benefits is not correct'' In the absence of competitive markets, we can use one - sided puces to determine exa…

Which of the following statements regarding the weighted average cost of capital

Which of the following statements regarding the weighted average cost of capital (WACC) are correct? Check all statements that apply The WACC represents the cost of all the capita…

Which of the following statements regarding “operating leverage” is incorrect ?

Which of the following statements regarding “operating leverage” is incorrect? A. Operating leverage comes from the firm’s expenses/costs that are fixed regardless of its sales or…

Which of the following statements related to interest rates are correct? I. Annu

Which of the following statements related to interest rates are correct? I. Annual interest rates consider the effect of interest earned on reinvested interest payments. II. When …

Which of the following statements related to the internal rate of return (IRR) i

Which of the following statements related to the internal rate of return (IRR) is correct? In most instances, if an investment is attractive based on its IRR, it will have a negat…

Which of the following statements would be consistent with Dividend Irrelevance

Which of the following statements would be consistent with Dividend Irrelevance Theory? There is no relationship between a firm's dividend policy and the value of its common stock…

Which of the following statements would be consistent with the residual dividend

Which of the following statements would be consistent with the residual dividend theory? - Wealthy investors prefer corporations to defer dividend payments because capital gains p…

Which of the following statements would be consistent with thebird-in-the-hand d

Which of the following statements would be consistent with thebird-in-the-hand dividend theory? a. Investors are indifferent whether stock returns comefrom dividend income or capi…

Which of the following statementsis CORRECT? a. Cost of preferred stock is the r

Which of the following statementsis CORRECT? a.   Cost of preferred stock is the rate of return investors require on the firm’s preferred stock it is calculated as the common stoc…

Which of the following statementsis CORRECT? a. Cost of preferred stock is the r

Which of the following statementsis CORRECT? a.   Cost of preferred stock is the rate of return investors require on the firm’s preferred stock it is calculated as the common stoc…

Which of the following strategies should improve a companies Return on equity (R

Which of the following strategies should improve a companies Return on equity (ROE)? CHECK ALL THAT APPLY. 1. Increase the interest rate on its note payable for long-term debt obl…

Which of the following techniques should be applied to a Equivalent Annual Unifo

Which of the following techniques should be applied to a Equivalent Annual Uniform Worth (EUAW) analysis of multiple alternatives when their lifetimes are not the same? A. Find a …

Which of the following tendencies of individual investors is called the disposit

Which of the following tendencies of individual investors is called the disposition effect?A)The tendency to trade too much based on the mistaken belief that they can pick winners…

Which of the following tendencies of individual investors is called the disposit

Which of the following tendencies of individual investors is called the disposition effect? A. The tendency to trade too much based on the mistaken belief that they can pick winne…

Which of the following tends to insulate management somewhat from the financial

Which of the following tends to insulate management somewhat from the financial results of poor financial planning? (Pick the best answer.) A. Capitated rates B. Cost reimbursemen…

Which of the following theorem explains the relationship between interest rates

Which of the following theorem explains the relationship between interest rates and bond prices? For a given change in interest rates, the prices of higher-coupon bonds will chang…

Which of the following transactions in NOT a secondary market transaction? GE se

Which of the following transactions in NOT a secondary market transaction? GE sells $30 million of new preferred stock. Microsoft sells $2 million of IBM preferred stock out of it…

Which of the following types of policies is most likely to allow you to switch i

Which of the following types of policies is most likely to allow you to switch investments? Limited pay life Whole life Variable life Term life Adjustable whole life The best way …

Which of the following types of risk is most likely avoided by forming a diversi

Which of the following types of risk is most likely avoided by forming a diversified portfolio? A Total risk B Systematic risk C Idiosyncratic (non-systematic) risk Which of the f…

Which of the following types of securities orders is designed to be executed in

Which of the following types of securities orders is designed to be executed in the shortest period of time? d. a market order The dollar amount of the recent cash dividend of a s…

Which of the following values will be equal tozero when a firm is producing the

Which of the following values will be equal tozero when a firm is producing the accounting break-even level ofoutput? I. operating cash flow II. internal rate of return III. net i…

Which of the following was a problem faced by mortgage lenders in trying to sell

Which of the following was a problem faced by mortgage lenders in trying to sell their mortgages in the secondary market prior to the creation of mortgage backed securities? The l…

Which of the following were part of the new “PR principles” introduced after the

Which of the following were part of the new “PR principles” introduced after the “public be damned phase” of PR? Tell the truth The public relations director must have access to t…

Which of the following will affect the beta value of an individual security? I.

Which of the following will affect the beta value of an individual security? I. interval of time frequency used for the data sample II. length of the time period used for the data…

Which of the following will increase the present value of an annuity? The discou

Which of the following will increase the present value of an annuity? The discount rate increases. The discount rate decreases. The number of periods the annuity received increase…

Which of the following will likely result in a greater use of external financing

Which of the following will likely result in a greater use of external financing? Higher corporate profits and higher interest rates Lower corporate profits and lower interest rat…

Which of the following would NOT be considered a capital budgeting decision? A)

Which of the following would NOT be considered a capital budgeting decision? A) Walmart purchases inventory for resale to customers. B) Morgan Stanley installs elevators to comply…

Which of the following would NOT be included in projecting the incremental net c

Which of the following would NOT be included in projecting the incremental net cash flow for the terminal year of a new project? the net change in operating cash flow after taxes …

Which of the following would be a method of improving a firm\'seconomic profit?

Which of the following would be a method of improving a firm'seconomic profit? Assume all else equal. a. Identify and improve operating efficiencies. b. Increase sales. c. Dispose…

Which of the following would be a viable way to earn abnormally high trading pro

Which of the following would be a viable way to earn abnormally high trading profits if markets are semistrong-form efficient? a) Buy shares in companies with low P/E ratios. b) B…

Which of the following would be an example of the\"transactions motive\" for a f

Which of the following would be an example of the"transactions motive" for a firm holding cash balances? a. Investing "excess cash balances." b. Anticipating a downturn in the eco…

Which of the following would be best considered to be an agency conflict problem

Which of the following would be best considered to be an agency conflict problem in the behavior of the following financial managers? A. Bill chooses to pursue a risky investment …

Which of the following would be classified as a junk bond? A bond rated Baa3 by

Which of the following would be classified as a junk bond? A bond rated Baa3 by Moody's A bond rated Bal by Moody's A bond rated BBB- by Standard and Poor's A bond rated A- by Sta…

Which of the following would be most likely to occur in the year after Congress,

Which of the following would be most likely to occur in the year after Congress, in an effort to increase tax revenue, passed legislation that forced companies to depreciate equip…

Which of the following would be subtracted from the balance per books on a bank

Which of the following would be subtracted from the balance per books on a bank reconciliation? error in recording a check for $732 as $723 notes collected by the bank outstanding…

Which of the following would best explain an increase in receivables turnover? A

Which of the following would best explain an increase in   receivables turnover? A. The company adopted new credit policies last year and began   offering credit to customers with…

Which of the following would decrease a portfolio s systematic risk? a. Common s

Which of the following would decrease a portfolio s systematic risk? a. Common stock with positive beta is sold and replaced with Treasury bills. b. Stocks with a beta equal to th…

Which of the following would give evidence of horizontal equity? a. A three-bedr

Which of the following would give evidence of horizontal equity? a. A three-bedroom house in Bloomington has a property tax bill of $1,000; an equivalent three-bedroom house in Fo…

Which of the following would not be a classification of a capital budgeting proj

Which of the following would not be a classification of a capital budgeting project? A regulatory project An expansion project A study by Greenpeace to determine the harm to the o…

Which of the following would not be an appropriate guideline for determining the

Which of the following would not be an appropriate guideline for determining the interest rate to use in discounting project cash flows in capital budgeting? a. for replacement pr…

Which of the following would not be classified as a material participant in an a

Which of the following would not be classified as a material participant in an activity? a. An individual who participates more than 100 hours a year and the person's participatio…