FIN 320|70 Final Exam |End Of Sem Questions With Correct Answers|2024
9 views 0 purchase
Course
FIN 320
Institution
FIN 320
3 investments, each pay 100 mo, with an 8% interest rate. one is an ordinary annuity, one is an annuity due, and the third is a perpetuity. which statement is correct given these three options? - ️️present value of a perp has to be higher than the present value either the ordinary annuity or an...
FIN 320|70 Final Exam |End Of Sem
3 investments, each pay 100 mo, with an 8% interest rate. one is an ordinary annuity, one is an annuity
due, and the third is a perpetuity. which statement is correct given these three options? - ✔ ✔
present value of a perp has to be higher than the present value either the ordinary annuity or annuity
due
A bond trader just purchased and resold a bond. The amount of profit earned by the trader from this
purchase and resale is...... - ✔ ✔ bid-ask spread
A firm decides to make a decision that decreases their liquidity. What decision did the firm just make? -
✔ ✔ cash purchase on inventory
All else held constant, PV of a bond increase when the.... - ✔ ✔ yield to maturing decreases
An agency issue is most apt to develop when..... - ✔ ✔ the control of a firm is separated from the
firm's ownership
Assume all else is equal. When comparing savings accounts, you should select the account that has the -
✔ ✔ highest effective annual rate
Bonds are described at which form of loan? - ✔ ✔ Interest Only Loan
Capital budgeting includes the evaluation of what? - ✔ ✔ size, timing, and risk of future cash flows
EPS measures the net income with respect to - ✔ ✔ the profit or loss for each share of stock
Firm is a separate legal entity and shares ownership of that firm on a 50/50 basis. What type of entity
did they create if they have no personal liability for the firms debt? - ✔ ✔ Corporation
For a risky security to have a positive expected return but less risk than the overall market, the security
must have a beta..... - ✔ ✔ that is > 0 but < 1
Generally speaking, payback is best used to evaluate which type of projects? - ✔ ✔ low-cost, short-
term
Given an interest rate of 0%, the future value of a lump sum invested today will always... - ✔ ✔
remain constant, regardless of the investment period
If a firm has an inventory turnover of 15, the firm... - ✔ ✔ sells its entire inventory an average of 15
times each year
If an investment is producing a return that is equal to the required return, the investments NPV will be...
- ✔ ✔ zero
, In what year was SARBOX enacted by congress? - ✔ ✔ 2002
Jamie earned $14 in interest on her savings account last year. She decided to leave the $14 in her
account so that she can earn interest on the $14 this year. The interest earned on last years interest
earnings is called.... - ✔ ✔ interest on interest
Janis just won a scholarship that will pay her 500 a month, starting today, and continuing for the next 48
months. What term describes these payments? - ✔ ✔ Annuity due
Jenna has been promoted and is now in charge of all external financing. in other words, she is in charge
of? - ✔ ✔ Capital Structure Management
Jenny needs to borrow 5500 for 4 years. The loan will be repaid in one lump sum at the end of the loan
term. Which one of the following interest rates is best for Jenny? - ✔ ✔ 6.5% simple interest
John owns a stock with a market price of $38 per share. This stock pays the same annual dividend of
$.60 per share. If the price of the stock suddenly decreased to $33, you would expect the..... - ✔ ✔
dividend yield to increase
Lee pays 1% per month interest on his credit card account. When his monthly rate is multiplied by 12,
the resulting answer is referred to as the....... - ✔ ✔ annual percentage rate
Miller Farm Products is issuing a 15 year, unsecured bond. Based on this info, you know that this debt
can be best described as...... - ✔ ✔ debenture
Over the past year, a firm decreased its current assets and increased its current liabilities. As a result,
the firms net working capital - ✔ ✔ had to decrease
Production equipment is classified as...... - ✔ ✔ a tangible fixed asset
Russell has a bond issue outstanding. The issue's indenture provision prohibits the firm from redeeming
the bonds during the first five years following issuance. This provision is referred to as the.... - ✔ ✔
deferred call provision
Semi-strong form market efficiency states that the value at a security is based on..... - ✔ ✔ all
publicly available info
Smith and Son's co. has a current ratio that is average in comparison to their industry, however, their
quick ratio is significantly lower than their industry average. The following can be concluded... - ✔ ✔
Smith and Sons has higher inventory than the industry average
Stacy deposits 5000 into an account that pays 2% interest, compounded annually. At the same time,
Kurt deposits 5000 into an account paying 3.5% interest, compounded annually. At the end of 3 years....
- ✔ ✔ Kurt will have a larger account value than Stacy
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller jackline98. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.99. You're not tied to anything after your purchase.
