How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask Manal Elkhoshkhany Your Own Question

Manal Elkhoshkhany
Manal Elkhoshkhany, Tutor
Category: Homework
Satisfied Customers: 9470
Experience:  More than 5000 online tutoring sessions.
3708793
Type Your Homework Question Here...
Manal Elkhoshkhany is online now
A new question is answered every 9 seconds

1. Which of the following statements best represents what finance

Resolved Question:

1. Which of the following statements best represents what finance is about?
a. How political, social, and economic forces affect corporations
b. Maximizing profits
c. Creation and maintenance of economic wealth
d. Reducing risk

2. Consider the timing of the profits of the following certain investment projects:
Profit
L S
Year 1 $ 0 $ 3000
Year 2 $ 3000 $ 0
a. Project S is preferred to Project L.
b. Project L is preferred to Project S.
c. Projects S and L are equally desirable.
d. A goal of profit maximization would favor Project S only.

3. Which of the following factors enable a public corporation to grow to a greater extent, and perhaps at a faster rate, than a partnership or a proprietorship?
a. Unlimited liability of shareholders
b. Access to the capital markets
c. Limited life
d. Elimination of double taxation on corporate income
e. All of the above

4. How could you compensate an investor for taking on a significant amount of risk?
a. Increase the expected rate of return.
b. Raise more debt capital.
c. Offer stock at a higher price.
d. Increase sales.

5. If an investor had a choice of receiving $1,000 today, or $1,000 in five years, which would the average investor prefer?
a. $1,000 in five years because they are not good at saving money.
b. $1,000 today because it will be worth more than $1,000 received in five years.
c. $1,000 in five years because it will be worth more than $1,000 received today.
d. Investors would be indifferent to when they would receive the $1,000.
e. None of the above.

6. Which of the following is not a reason why financial analysts use ratio analysis?
a. Ratios help to pinpoint a firm's strengths.
b. Ratios restate accounting data in relative terms.
c. Ratios are ideal for smoothing out the differences that may exist when comparing firms that use different accounting practices.
d. Some of a firm’s weaknesses can be identified through the usage of ratios.

7. The question "Did the common stockholders receive an adequate return on their investment?" is answered through the use of:
a. liquidity ratios.
b. profitability ratios.
c. coverage ratios.
d. leverage ratios.

8. Marshall Networks, Inc. has a total asset turnover of 2.5 and a net profit margin of 3.5%. The firm has a return on equity of 17.5%. Calculate Marshall’s debt ratio.
a. 30%
b. 40%
c. 50%
d. 60%

9. The quick ratio is a better measure of liquidity than the current ratio if the firm has current assets composed primarily of:
a. cash.
b. work in process inventory.
c. marketable securities.
d. accruals.

10. Which of the following is not a limitation related to the usage of ratios when reviewing a firm’s performance?
a. Many firms experience seasonality in their operations.
b. Ratios cannot be used to compare firms that are in the same industry if one firm’s sales are higher than another firm’s.
c. Some firms operate in a variety of business lines, which makes it difficult to make comparisons.
d. Accounting practices differ widely among firms.

11. The _______ is the federal agency primarily responsible for regulating the securities industry.
a. FTC
b. SEC
c. FRB
d. SCC

12. __________ is a financial specialist who underwrites and distributes new securities of public corporations.
a. The Federal Reserve Board
b. A commercial banker
c. The SEC
d. An investment banker

13. What is the role of the SEC as it relates to the issuance of new securities by U.S. corporations?
a. To guaranty the sale of securities to the public
b. To ensure accurate and complete disclosure of information about the issuing firm to the public
c. To reduce the cost of issuing securities to the public
d. To provide investment advice to the purchasing public

14. All of the following are found in the cash budget except:
a. a net change in cash for the period.
b. inventory.
c. cash disbursements.
d. new financing needed.

15. A company collects 60% of its sales during the month of the sale, 30% one month after the sale, and 10% two months after the sale. The company expects sales of $10,000 in August, $20,000 in September, $30,000 in October, and $40,000 in November. How much money is expected to be collected in October?
a. $25,000
b. $15,000
c. $35,000
d. None of the above

16. Which of the following are considered to be spontaneous sources of financing (i.e., they arise naturally during the course of doing business)?
a. Notes payable and common stock
b. Accounts receivable and bonds
c. Fixed assets and inventory
d. Accounts payable and accrued expenses

17. The first step involved in predicting financing needs is:
a. projecting the firm’s sales revenues and expenses over the planning period.
b. estimating the levels of investment in current and fixed assets that are necessary to support the projected sales.
c. determining the firm’s financing needs throughout the planning period.
d. none of the above.

18. At 8% compounded annually, how long will it take $750 to double?
a. 6.5 years
b. 48 months
c. 9 years
d. 12 years

19. A friend plans to buy a big-screen TV/entertainment system and can afford to set aside $1,320 toward the purchase today. If your friend can earn 5.0%, how much can your friend spend in four years on the purchase? Round off to the nearest $1.
a. $1,444
b. $1,604
c. $1,764
d. $1,283

20. You have just purchased a share of preferred stock for $50.00. The preferred stock pays an annual dividend of $5.50 per share forever. What is the rate of return on your investment?
a. .055
b. .010
c. .110
d. .220

21. A commercial bank will loan you $7,500 for two years to buy a car. The loan must be repaid in 24 equal monthly payments. The annual interest rate on the loan is 12% of the unpaid balance. What is the amount of the monthly payments?
a. $282.43
b. $390.52
c. $369.82
d. $353.05

22. Gina Dare, who wants to be a millionaire, plans to retire at the end of 40 years. Gina’s plan is to invest her money by depositing into an IRA at the end of every year. What is the amount that she needs to deposit annually in order to accumulate $1,000,000? Assume that the account will earn an annual rate of 11.5%. Round off to the nearest $1.
a. $1,497
b. $5,281
c. $75
d. $3,622

23. The break-even model enables the manager of the firm to:
a. calculate the minimum price of common stock for certain situations.
b. set appropriate equilibrium thresholds.
c. determine the quantity of output that must be sold to cover all operating costs.
d. determine the optimal amount of debt financing to use.

24. Financial leverage means financing some of a firm’s assets with:
a. commercial paper.
b. preferred stock.
c. corporate bonds.
d. all of the above.

25. In general, as the level of sales rises above the break-even point, the degree of operating leverage:
a. increases.
b. decreases.
c. remains constant.
d. none of the above.

26. Due to a technical breakthrough, the fixed costs for a firm drop by 25%. Prior to this breakthrough, fixed costs were $100,000 and unit contribution margin was and remains at $5.00. The new amount of break-even units will be:
a. 25,000.
b. 20,000.
c. 15,000.
d. 10,000.

27. The firm should accept independent projects if:
a. the payback is less than the IRR.
b. the profitability index is greater than 1.0.
c. the IRR is positive.
d. the NPV is greater than the discounted payback.

28. The NPV method:
a. is consistent with the goal of shareholder wealth maximization.
b. recognizes the time value of money.
c. uses cash flows.
d. all of the above.

29. ABC Service can purchase a new assembler for $15,052 that will provide an annual net cash flow of $6,000 per year for five years. Calculate the NPV of the assembler if the required rate of return is 12%. (Round your answer to the nearest $1.)
a. $1,056
b. $4,568
c. $7,621
d. $6,577

30. Given the following annual net cash flows, determine the IRR to the nearest whole percent of a project with an initial outlay of $1,520.
Year Net Cash Flow
1 $1,000
2 $1,500
3 $ 500
a. 48%
b. 40%
c. 32%
d. 28%

31. An increase in ___________ would increase net working capital.
a. plant and equipment
b. accounts payable
c. accounts receivable
d. both b and c

32. Which of the following is most likely to be a temporary source of financing?
a. Commercial paper
b. Preferred stock
c. Long-term debt
d. All of the above

33. In order to maximize firm value, management should invest in new assets when the internal rate of return is:
a. greater or equal to the firm’s marginal cost of capital.
b. greater than the cost of debt financing.
c. less than or equal to the accounting rate of return.
d. less than or equal to the firm’s marginal cost of capital.

34. In the basic model, the optimal inventory level is the point at which:
a. total cost is minimized.
b. total revenue is maximized.
c. carrying costs are minimized.
d. ordering costs are minimized.

35. The management of inventory is important because:
a. carrying too much inventory can result in a loss of efficiency and profitability.
b. carrying excessive inventory can result in a loss of sales.
c. carrying too little inventory can decrease the average collection period.
d. carrying too little inventory will adversely affect the firm’s CAPM.

36. An operating lease usually:
a. is for a shorter length of time than a financial lease.
b. is for high-tech equipment that might become obsolete rapidly.
c. has the income tax advantage that the entire lease payment is a deductible expense.
d. both a and c.
e. all the above.

37. If a lease is extended for a length of time that is equal to the entire useful life of the equipment, the lease:
a. is referred to as an operating lease.
b. carries no income tax deduction.
c. is a financial lease.
d. will be terminated by the IRS.

38. Which of the following would decrease free cash flows? A decrease in:
a. depreciation expense.
b. interest expense.
c. incremental sales.
d. both a & c.
e. all of the above.

39. An increase in the ____________ is likely to encourage a corporation to increase its debt ratio.
a. corporate tax rate
b. personal tax rate
c. company’s degree of operating leverage
d. expected cost of bankruptcy

40. A merger that is driven by the potentially large reduction in the staffing of overlapping functions and the integration of the two companies’ strong similar product lines is referred to as a:
a. conglomerate merger.
b. vertical merger.
c. horizontal merger.
d. diversification merger.
Submitted: 4 years ago.
Category: Homework
Expert:  Manal Elkhoshkhany replied 4 years ago.
THIS ANSWER IS LOCKED!

You need to spend $3 to view this post. Add Funds to your account and buy credits.
Manal Elkhoshkhany, Tutor
Category: Homework
Satisfied Customers: 9470
Experience: More than 5000 online tutoring sessions.
Manal Elkhoshkhany and 4 other Homework Specialists are ready to help you

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
< Last | Next >
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin Kernersville, NC
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther Woodstock, NY
  • Thank you so much for taking your time and knowledge to support my concerns. Not only did you answer my questions, you even took it a step further with replying with more pertinent information I needed to know. Robin Elkton, Maryland
  • He answered my question promptly and gave me accurate, detailed information. If all of your experts are half as good, you have a great thing going here. Diane Dallas, TX
 
 
 

Meet The Experts:

 
 
 
  • Manal Elkhoshkhany

    Tutor

    Satisfied Customers:

    4520
    More than 5000 online tutoring sessions.
< Last | Next >
  • http://ww2.justanswer.com/uploads/BU/BusinessTutor/2012-2-2_115741_Kouki2.64x64.jpg Manal Elkhoshkhany's Avatar

    Manal Elkhoshkhany

    Tutor

    Satisfied Customers:

    4520
    More than 5000 online tutoring sessions.
  • http://ww2.justanswer.com/uploads/LI/lindaus/2012-6-10_04811_IMG20120609164157.64x64.jpg Linda_us's Avatar

    Linda_us

    Finance, Accounts & Homework Tutor

    Satisfied Customers:

    3121
    Post Graduate Diploma in Management (MBA)
  • http://ww2.justanswer.com/uploads/ComputersGuru/2010-02-13_051118_Photo41.JPG LogicPro's Avatar

    LogicPro

    Engineer

    Satisfied Customers:

    3035
    Expert in Java C++ C C# VB Javascript Design SQL HTML
  • http://ww2.justanswer.com/uploads/lanis/2009-4-1_233717_phput9xef_c1pm.jpg Lani S.'s Avatar

    Lani S.

    Tutor

    Satisfied Customers:

    2457
    Registered Nurse, Internet Researcher, Private Tutor
  • http://ww2.justanswer.com/uploads/chooser77/2009-08-18_162025_Chris.jpg Chris M.'s Avatar

    Chris M.

    M.S.W. Social Work

    Satisfied Customers:

    2341
    Master's Degree, strong math and writing skills, experience in one-on-one tutoring (college English)
  • http://ww2.justanswer.com/uploads/JawaadAhmed/2009-6-27_12137_SIs_SHadi.jpg F. Naz's Avatar

    F. Naz

    Chartered Accountant

    Satisfied Customers:

    1975
    Experience with chartered accountancy
  • http://ww2.justanswer.com/uploads/JK/jkcpa/2011-1-16_182614_jkcpa.64x64.jpg Bizhelp's Avatar

    Bizhelp

    CPA

    Satisfied Customers:

    1873
    Bachelors Degree and CPA with Accounting work experience