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

Urban Outfitters wants to raise $25 million to finance the construction of a new store,and the company wishes to raise the funds through direct finance.Which of the following methods could it use?

Assume you and your cousin Vinny set up a partnership and your lawyer tells you that as the owners you will each face unlimited liability.What does that mean?

How do a sole proprietorship and a corporation differ?

Traditionally,Wall Street investment banks had been organized as partnerships,but by 2000 they had converted to being publicly traded corporations.As partnerships,the principal-agent problem is ________,but as publicly traded corporations,the principal-agent problem is often ________.

Small savers who only have enough money to buy a few individual financial assets can use ________ to diversify.

When Snap sells newly issued shares of stock this is an example of

An asset is

The Sarbanes-Oxley Act of 2002

You have a bond that pays $125 per year in coupon payments.Which of the following would result in an increase in the price of your bond?

Raising funds through financial intermediaries is called

Over ninety-five percent of all new businesses that open each year in the United States employ ________ workers.

During 2007,many "subprime" and "Alt-A" borrowers began to default on their mortgages.Describe "subprime" and "Alt-A" borrowers.

Which is the least common type of business?

What happens in the primary market?

If you own a bond with a six percent coupon rate and new bonds are paying six percent,what will happen to your bond's market price?

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

A sole proprietorship is

Anything owed by a person or a firm is

In a public corporation,asymmetric information often results in a principal-agent problem between top management and ownership.What information would help to prevent this principal-agent problem?

Of the different types of businesses,a corporation has the ________ government rules and the ________ government regulations affecting it.