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

Jeremy is thinking of starting up a small business selling NASCAR memorabilia.He is considering setting up his business as a sole proprietorship.What is one advantage to Jeremy of setting up his business as a sole proprietorship?

If you borrow $5,000 from your bank to purchase shares of Snap from your cousin Vinny,this is an example of obtaining ________ financing and purchasing the stock in a ________ market.

Which of the following is a characteristic of stock?

When the coupon rate on newly issued bonds increases relative to older,outstanding bonds,what happens?

The typical firm in many industries has become ________ over the past 100 years,and efficiently organizing production has become ________.

You have a bond that pays $60 per year in coupon payments.Which of the following would result in an increase in the price of your bond?

Why do financial markets depend on accurate accounting and disclosure practices?

The decline in new business startups

The Sarbanes-Oxley Act of 2002 was passed in response to what event/events?

From the highest to the lowest,the percentage of profits earned by businesses in the United States is represented by which of the following?

Southwest Airlines wants to raise $20 million to finance the renovation of their corporate offices,and the company wishes to raise the funds through direct finance.Which of the following methods could it use?

The Aristocrat Corporation has taken out a loan to buy manufacturing equipment.The loan represents ________ for the company.

Mortgage-backed securities are similar to bonds in that the investor who buys one receives

What are the advantages of setting up a proprietorship or partnership as opposed to a corporation?

Corporate governance refers to the way in which a corporation is structured and the effect that structure has on the corporation's behavior.

The owners of a ________ have a separate legal distinction from the business.

Which of the following takes place in the direct finance market?

Before its IPO,Snap,the parent firm of Snapchat,was an example of a private firm.As a private firm,Snap was

Dividing the dividend payment by the stock's ________ determines the dividend yield.

Which of the following is an example of an implicit cost that a firm might incur?