Exam 6: Firms, the Stock Market, and Corporate Governance

When someone takes out a mortgage loan to buy a house,the mortgage lender can take possession of the house and sell it if the borrower defaults by failing to make payments on the loan because the house is being pledged as ________ for the loan.

Which of the following is an advantage of starting a new business as a corporation?

If a corporation earns a profit,how do owners of the firm share in the profit?

In addition to requiring that CEO's personally certify the accuracy of financial statements,the Sarbanes-Oxley Act of 2002 also requires that

In a typical year,________ of new jobs are created by small firms.

What is an inside director?

When you buy newly-issued shares of Facebook stock,this transaction takes place in the

If Abercrombie & Fitch borrows $8 million from a bank to finance the construction of a new store,this is an example of

In 2011,the dividend yield on Microsoft (MSFT)stock rose from 1.97% to 3.10%.Which of the following would have generated that result?

What is shown on a firm's income statement?

In 2013,the dividend yield on Abercrombie & Fitch (ANF)stock rose from a low of 1.33% in May to 2.24% in October.Which of the following would have generated that result?

Donnie's Donuts incurs $450,000 per year in explicit costs and $200,000 in implicit costs.The bakery earns $800,000 in revenues and has $2 million in net worth.Based on this information,what is the accounting profit for Donnie's Donuts?

A stock's dividend yield is determined by

Who controls a sole proprietorship?

What is economic profit?

Which is the least common type of business?

Payments by a corporation to its shareholders are known as

When you buy previously-issued shares of Facebook stock,this transaction takes place in the

As a form of business,a partnership

By tying the salaries of top corporate managers to the price of the corporation's stock,corporations hope to avoid