3 answers

The belief that investors require a higher return to entice them into holding long-term securities is the viewpoint of the

Question:

1. The belief that investors require a higher return to entice them into holding long-term securities is the viewpoint of the

A. the expectations hypothesis
B. segmentation theory
C. the liguidity premium theory
D. market credit crunch theory

2. The market allocates capital to companies based on

A. risk
B. efficiency
C. expected returns
D. all of the above

3. As the interest rate increases, the present value of an amount to be received at the end of a fixed period

A. increases
B. decreases
C. remains the same
D. not enough information to tell

4. A conservative financing plan involves

A. heavy reliance on debt
B. heavy reliance on equity
C. high degree of financial leverage
D. high degree of combined leverage

5. At age 5, how much would you have to save per month to have $1 million in your account at age 65, if your investment reate was 10% per year? Assume no taxes and compounding on a monthly basis

A. $213.30
B. $21.23
C. $274.60
D. can't be done with these assumptions

6. the extent to which inventory financing may be use depends on

A. marketability of pledged goods
B. price stability of goods
C. perishability of goods
D. all of the above

7. After 20 years, 100 shares of stock originally purchased for $1000 was sold for $5000. What was the yield on the investment? Choose the closest answer.

A. 19%
B. 5%
C. 12.7%
D. 8%

8. Unders normal conditions (70% probability), Financing Plan A will produce $24,000 higher than Plan B. Under tight money conditions (30% probability), Plan A will produce $40,000 less then Plan B. What is the expected value of return for Plan A ove Plan B

A. $28,800
B. $4,000
C. $4,800
D. 35,2000

9. When Patricia sells her General Motors common stock at the same time that Brian purchases the same amount of General Motor's stock, General Motors receives:

A. the "spread" between the Bid and Ask of the transaction.
B. the dollar amount of the transaction, less brokerage fees.
C. only the par value of the common stock
D. nothing

10. Corporations that do not issue financial securities such as stock or debt obligations:

A. will not be able to increase sales
B. cannot be profitable
C. generate sufficient funds to fullfill their needs
D. do not face double taxation of their profits

Answers

..

1C; 2D; 3C; 4D; 5A ; 6B; 7C; 8C; 9A; 10D.

This is not a test-taking service. You have to make an effort.
1C; 2D; 3C ...

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