BSNS114 EXAMS BUNDLE WITH Questions Solved 100% Correct

What is a pure discount loan? (write full def) a. interest is paid periodically and principle is paid at maturity b. interest and principle are paid as a lump sum at maturity c. equal payments are made regularly, including a portion of principle and interest - Answer interest and principle are p...

Time value of money rule - Answer Receiving CFs earlier is a lot better than receiving CFs later as TVM rule states that money generally becomes less valuable overtime due to the effects of inflation. ATS (After tax salvage) - Answer If you sell your assets at the end of your project & make a pr...

What are some disciplinary mechanisms for the agency problem? - Answer Shareholders annual meeting Board of directors Compensation plan (incentives such as salary bonus connected to performance) Why does the shareholder's annual meeting often fail in practice? - Answer Most shareholders do not...

Advantages of sole proprietorship - Answer Simple, inexpensive, no sharing of profits, taxed as personal income Disadvantages of sole proprietorship - Answer Limited capital, costly to transfer ownership, unlimited liability Advantages of partnership - Answer Two or more owners, more capital, ea...

partnership - Answer 2 or more business owners have joined together legally to manage and share its profits General partnership - Answer all partners are owners and active in managing the firm -equally share profits and losses -don't decide on own -all partners invest money

Where can a corporate company get capital? - Answer Corporations can borrow from savers (surplus of resource) How does a business raise money - Answer Gain money by selling/trading securities (debt and equity) What do savers(investors) get back in exchange for their money? - Answer Debt holders ...