Question 1

A stock's ________ can be calculated by dividing total shareholders' equity by the total number of shares of stock issued.

Accepted Answer

A)  par value 
B)  market value 
C)  book value 
D)  all of the above 
A)  par value 
B)  market value 
C)  book value 
D)  all of the above

Question 2

Mathematically explain how a stock split works if a company has 100,000 common shares outstanding that are trading at $100 per share.

Accepted Answer

If a company has 100,000 common shares o

Question 3

Short Case Scenario 16-1
Jessica is looking forward to a family reunion at the beach. She is the first in her family to have graduated from college. She started her studies at the local community college and transferred to a prestigious private college several hours from her family's home. Jessica's major in college was business administration with a concentration in finance.
As she approaches the beach house where her family will be staying, Jessica is glad that her days of being quizzed and tested are over. She is looking forward to an opportunity to relax and to put her brain on "pause." However, Jessica's family has other plans for her. Almost before she emerges from her car, the questions begin.
Jessica's great-aunt Irene is hoping for a little investment advice. Irene explains, "One of my CDs has recently matured and I'm hoping to roll it into an investment where I might make a little more interest. Your cousin Eddie has suggested that I invest in bonds, but I'm not sure what to think. You know, dear, Eddie's never been very bright and I'd be foolish to take his advice without a little more information.
-How might Jessica explain the difference between a bull market and a bear market?

Accepted Answer

Bull markets are periods of ri

Question 4

An investment bank is a financial institution that specializes in issuing and reselling new securities.

Accepted Answer

A) True 
 B)False

Question 5

A stock's book value is ________.

Accepted Answer

A)  the current price of a share of stock in the stock market 
B)  the average price of one share of stock over the past year 
C)  the face value of a share of stock, set by the issuing company's board of directors 
D)  the value of a common stock expressed as total stockholders' equity divided by the total number of shares of stock issued 
A)  the current price of a share of stock in the stock market 
B)  the average price of one share of stock over the past year 
C)  the face value of a share of stock, set by the issuing company's board of directors 
D)  the value of a common stock expressed as total stockholders' equity divided by the total number of shares of stock issued

Question 6

The ________ is figured by dividing the yearly dollar amount of dividend income by the investment's current market value.

Accepted Answer

A)  bond yield 
B)  current dividend yield 
C)  debenture 
D)  trading volume 
A)  bond yield 
B)  current dividend yield 
C)  debenture 
D)  trading volume

Question 7

A(n)________ is an organization of individuals coordinated to provide an institutional setting in which stock can be bought and sold.

Accepted Answer

A)  stock exchange 
B)  brokerage 
C)  server 
D)  over-the-counter market 
A)  stock exchange 
B)  brokerage 
C)  server 
D)  over-the-counter market

Question 8

Short Case Scenario 16-1
Jessica is looking forward to a family reunion at the beach. She is the first in her family to have graduated from college. She started her studies at the local community college and transferred to a prestigious private college several hours from her family's home. Jessica's major in college was business administration with a concentration in finance.
As she approaches the beach house where her family will be staying, Jessica is glad that her days of being quizzed and tested are over. She is looking forward to an opportunity to relax and to put her brain on "pause." However, Jessica's family has other plans for her. Almost before she emerges from her car, the questions begin.
Jessica's great-aunt Irene is hoping for a little investment advice. Irene explains, "One of my CDs has recently matured and I'm hoping to roll it into an investment where I might make a little more interest. Your cousin Eddie has suggested that I invest in bonds, but I'm not sure what to think. You know, dear, Eddie's never been very bright and I'd be foolish to take his advice without a little more information.
-Aunt Irene suddenly asks about mutual funds.How should Jessica explain them to her?

Accepted Answer

As an alternative to buying stock,mutual

Question 9

The Dow Jones Industrial Average is the most widely cited American stock index.

Accepted Answer

A) True 
 B)False

Question 10

Before a corporation sells securities,that corporation is required by law to offer future investors the opportunity to read through a document which contains complete information on both the new issue and the corporations.What is that required document called?

Accepted Answer

A)  book report 
B)  affidavit 
C)  prospectus 
D)  order blank 
A)  book report 
B)  affidavit 
C)  prospectus 
D)  order blank

Question 11

Low grade bonds are usually called ________.

Accepted Answer

A)  bankruptcy 
B)  default bonds 
C)  junk bonds 
D)  corporate bonds 
A)  bankruptcy 
B)  default bonds 
C)  junk bonds 
D)  corporate bonds

Question 12

Which of the following allows after-hours trading and protect traders' anonymity?

Accepted Answer

A)  National Association of Securities Dealers Automated Quotation (NASDAQ) 
B)  New York Stock Exchange (NYS
E)  
C)  Electronic Communication Networks (ECNs) 
D)  None of the above 
A)  National Association of Securities Dealers Automated Quotation (NASDAQ) 
B)  New York Stock Exchange (NYS
E)  
C)  Electronic Communication Networks (ECNs) 
D)  None of the above

Question 13

What is a prospectus?

Accepted Answer

A prospectus is a booklet whose publicat

Question 14

________ receive and execute buy-and-sell orders for other people in return for commissions.

Accepted Answer

A)  Stock exchanges 
B)  Stock brokers 
C)  Investment banks 
D)  Stock agents 
A)  Stock exchanges 
B)  Stock brokers 
C)  Investment banks 
D)  Stock agents

Question 15

Positive working capital means ________ .

Accepted Answer

A)  the firm's current liabilities are large enough to pay off current assets 
B)  the firm may need to borrow money from a commercial bank. 
C)  the firm's current assets are large enough to pay off current liabilities 
D)  none of the above 
A)  the firm's current liabilities are large enough to pay off current assets 
B)  the firm may need to borrow money from a commercial bank. 
C)  the firm's current assets are large enough to pay off current liabilities 
D)  none of the above

Question 16

Venture capital is private funds from wealthy individuals or companies that seek investment opportunities in new growth companies.

Accepted Answer

A) True 
 B)False

Question 17

In 2008,each share of GE stock was receiving annual dividends payments of $1.24.If on a particular day,the share price was $33.82,what would the current yield be?

Accepted Answer

Current dividend yield and interest divi

Question 18

In a secondary securities market,new stocks and bonds are bought and sold by firms and governments.

Accepted Answer

A) True 
 B)False

Question 19

Explain the Rule of 72.

Accepted Answer

The Rule of 72 is used to figure out how

Question 20

A ________ is a formal pledge (an IOU)obligating the issuer to pay interest periodically and repay the principal at maturity (a preset future date)to the lender.

Accepted Answer

A)  commercial bank loan 
B)  corporate bond 
C)  mutual fund 
D)  bond indenture 
A)  commercial bank loan 
B)  corporate bond 
C)  mutual fund 
D)  bond indenture

A stock's ________ can be calculated by dividing total shareholders' equity by the total number of shares of stock issued.

Mathematically explain how a stock split works if a company has 100,000 common shares outstanding that are trading at $100 per share.

An investment bank is a financial institution that specializes in issuing and reselling new securities.

A stock's book value is ________.

The ________ is figured by dividing the yearly dollar amount of dividend income by the investment's current market value.

A(n)________ is an organization of individuals coordinated to provide an institutional setting in which stock can be bought and sold.

The Dow Jones Industrial Average is the most widely cited American stock index.

Before a corporation sells securities,that corporation is required by law to offer future investors the opportunity to read through a document which contains complete information on both the new issue and the corporations.What is that required document called?

Low grade bonds are usually called ________.

Which of the following allows after-hours trading and protect traders' anonymity?

What is a prospectus?

________ receive and execute buy-and-sell orders for other people in return for commissions.

Positive working capital means ________ .

Venture capital is private funds from wealthy individuals or companies that seek investment opportunities in new growth companies.

In 2008,each share of GE stock was receiving annual dividends payments of $1.24.If on a particular day,the share price was $33.82,what would the current yield be?

In a secondary securities market,new stocks and bonds are bought and sold by firms and governments.

Explain the Rule of 72.

A ________ is a formal pledge (an IOU)obligating the issuer to pay interest periodically and repay the principal at maturity (a preset future date)to the lender.

The U.S.Business Environment

Business Ethics and Social Responsibility

Entrepreneurship, New Ventures, and Business Ownership

The Global Context of Business

Business Management

Organizing the Business

Operations Management and Quality

Employee Behavior and Motivation

Leadership and Decision Making

Human Resource Management and Labor Relations

Marketing Processes and Consumer Behavior

Pricing, Distributing, and Promoting Products

The Role of Accountants and Accounting Information

Money and Banking

Filters

Exam 16: Managing Finances

A stock's ________ can be calculated by dividing total shareholders' equity by the total number of shares of stock issued.

Mathematically explain how a stock split works if a company has 100,000 common shares outstanding that are trading at $100 per share.

An investment bank is a financial institution that specializes in issuing and reselling new securities.

A stock's book value is ________.

The ________ is figured by dividing the yearly dollar amount of dividend income by the investment's current market value.

A(n)________ is an organization of individuals coordinated to provide an institutional setting in which stock can be bought and sold.

The Dow Jones Industrial Average is the most widely cited American stock index.

Before a corporation sells securities,that corporation is required by law to offer future investors the opportunity to read through a document which contains complete information on both the new issue and the corporations.What is that required document called?

Low grade bonds are usually called ________.

Which of the following allows after-hours trading and protect traders' anonymity?

What is a prospectus?

________ receive and execute buy-and-sell orders for other people in return for commissions.

Positive working capital means ________ .

Venture capital is private funds from wealthy individuals or companies that seek investment opportunities in new growth companies.

In 2008,each share of GE stock was receiving annual dividends payments of $1.24.If on a particular day,the share price was $33.82,what would the current yield be?

In a secondary securities market,new stocks and bonds are bought and sold by firms and governments.

Explain the Rule of 72.

A ________ is a formal pledge (an IOU)obligating the issuer to pay interest periodically and repay the principal at maturity (a preset future date)to the lender.

The U.S.Business Environment

Business Ethics and Social Responsibility

Entrepreneurship, New Ventures, and Business Ownership

The Global Context of Business

Business Management

Organizing the Business

Operations Management and Quality

Employee Behavior and Motivation

Leadership and Decision Making

Human Resource Management and Labor Relations

Marketing Processes and Consumer Behavior

Pricing, Distributing, and Promoting Products

The Role of Accountants and Accounting Information

Money and Banking

Filters