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

Shontae wants to start a pet hotel and is thinking of setting it up as a partnership with her sister Victoria.What are the advantages and disadvantages she will face by setting up the business as a partnership as opposed to a sole proprietorship or a corporation?

Stockholders

Define a sole proprietorship.

A firm's net worth is calculated as

Which of the following would be considered an implicit cost of operating a business?

Mutual funds sell shares to investors and use the funds to

All of the following are examples of explicit cost a firm might incur except

When an investor buys a corporate bond

The decline in new business startups

What is accounting profit?

Jack Dorsey is the Chief Executive Officer of Twitter as well as a member of Twitter's board of directors.Dorsey is therefore classified as an

Giorgio wants to build a new distribution warehouse for his sporting goods business and is going to issue new shares of stock to do so.This is an example of using ________ for his building project.

Which of the following are examples of explicit costs a firm might incur?

The central role of ________ in a market economy is bringing together savers and borrowers.

The Sarbanes-Oxley Act of 2002 requires that CEOs personally certify the accuracy of financial reports.

Generally with bond ratings,the ________ the rating,the higher the interest rate an investor will receive and the ________ the risk that the issuer of the bond will default.

Profits that are reinvested in a firm rather than paid to the firm's owners are called

In which types of business do owners have unlimited personal liability and in which do owners have limited personal liability?

An implicit cost is

In the late 1970s,________ of all firms were less than a year old.In recent years,________ were.