Question: Suppose all firms follow similar financing policies, face similar risks, have equal access to capital, and operate in competitive product and capital markets. However, firms face different operating conditions because, for example, the grocery store industry is different from the airline industry. Under these conditions, firms with high profit margins will tend to have high asset turnover ratios, and firms with low profit margins will tend to have low turnover ratios.
Answer Choices:
A. True
B. False
Answer: B – False
Question: Klein Cosmetics has a profit margin of 5.0%, a total assets turnover ratio of 1.5 times, no debt and therefore an equity multiplier of 1.0, and an ROE of 7.5%. The CFO recommends that the firm borrow funds using long-term debt, use the funds to repurchase some of its own stock, thus increasing leverage. Assuming that the firm’s operating results (PM, TATO) do not change, the firm’s ROE will increase.
Answer Choices:
A. True
B. False
Answer: A – True
Question: If a firm’s ROE is equal to 9% and its ROA is equal to 6%, its equity multiplier must be 1.5.
Answer Choices:
A. True
B. False
Answer: A – True
Question: If a firm’s ROE is equal to 9% and its ROA is equal to 6%. The firm finances only with short-term debt, long-term debt, and common equity, so assets equal total invested capital. The firm’s total debt to total capital ratio must be 50%.
Answer Choices:
A. True
B. False
Answer: B – False
Question: One problem with ratio analysis is that relationships can sometimes be manipulated. For example, if our current ratio is greater than 1.5, then borrowing on a short-term basis and using the funds to build up our cash account would cause the current ratio to INCREASE.
Answer Choices:
A. True
B. False
Answer: A – True
Question: Considered alone, which of the following would increase a company’s current ratio? a. An increase in net fixed assets. b. An increase in accrued liabilities. c. An increase in notes payable. d. An increase in accounts receivable. e. An increase in accounts payable.
Answer Choices:
Answer: D – An increase in accounts receivable.
Question: In 1946, the APA published a new journal as the voice of a new, unified psychology. What was this journal?
Answer Choices:
A. American Psychologist
B. Journal of Clinical Psychology
C. Journal of Applied Psychology
D. Journal of American Psychology
Answer: A – American Psychologist
Question: After World War II, the dominant type of psychotherapy was:
Answer Choices:
A. psychoanalysis
B. client-centered therapy
C. humanistic therapy
D. cognitive-behavioral therapy
Answer: A – psychoanalysis
Question: When psychologists began performing psychotherapy following World War II, they came into competition with:
Answer Choices:
A. psychiatrists
B. religious leaders
C. applied psychologists
D. social workers
Answer: A – psychiatrists
Question: The Psy.D. degree:
Answer Choices:
A. provides professional training for clinical psychologists
B. provides training in research and methodology
C. is similar to a Master of Science degree
D. equates more with the degree of Ph.D. than with M.D.
Answer: A – provides professional training for clinical psychologists
Question: James believed that the single most informative thing you could know about a person was his or her:
Answer Choices:
A. early experience
B. worldview
C. genetic makeup
Answer: B – worldview
Question: During Witmer’s time, what were the prevailing attitudes toward applied psychology?
Answer Choices:
A. First came rigorous, scientific training; second came the attempt to apply scientific knowledge to practical problems.
B. First came the attempt to apply scientific knowledge to practical problems; second came rigorous, scientific training.
C. First came a deep philosophical inquiry into psychology; second came the attempt to apply scientific knowledge to practical problems.
D. First came the attempt to apply scientific knowledge to practical problems; second came a deep philosophical inquiry into psychology.
Answer: A – First came rigorous, scientific training; second came the attempt to apply scientific knowledge to practical problems.
Question: What was one effect of World War I on the field of psychology?
Answer Choices:
A. Many people became disheartened with the study of human behavior.
B. An interest in the philosophical questions regarding human nature was renewed.
C. Psychotherapy became widely available on the battlefield.
D. Psychometric tests were used for the evaluation of soldiers.
Answer: D – Psychometric tests were used for the evaluation of soldiers.
Question: Clinicians began to create their own professional organizations when they did not receive recognition and status within the APA. What was the first organization of this type?
Answer Choices:
A. American Psychological Society
B. American Association of Clinical Psychologists
C. American Association of Applied Psychology
D. Psychonomic Society
Answer: B – American Association of Clinical Psychologists
Question: The two cultures described by C. P. Snow consisted of:
Answer Choices:
A. tender-minded and tough-minded philosophers
B. literary intellectuals and scientists
C. scientifically oriented and humanistically oriented psychologists
D. medically minded and scientifically minded scholars
Answer: B – literary intellectuals and scientists
Question: Kimble’s data found that:
Answer Choices:
A. undergraduate psychology students showed a slight inclination toward accepting humanistic values
B. officers of the divisions of the American Psychological Association showed a strong inclination toward accepting scientific values
C. humanistic psychologists showed a strong inclination toward accepting scientific values
D. psychotherapists showed a strong inclination toward accepting scientific values
Answer: A – undergraduate psychology students showed a slight inclination toward accepting humanistic values
Question: James argued that philosophers could be divided into two general groups: _____ and _____.
Answer Choices:
A. rationalists; pragmatists
B. focused; eclectic
C. humanists; behaviorists
D. tender-minded; tough-minded
Answer: D – tender-minded; tough-minded
Question: Many psychologists see psychology’s diversity as:
Answer Choices:
A. necessary, given the complexity of humans
B. a sign that psychology has fully employed the scientific method
C. expected because the field is still in the paradigmatic stage
D. a troubling sign of further tension amongst the divisions
Answer: A – necessary, given the complexity of humans
Question: According to Sternberg and Grigorenko, what creates unproductive diversity within psychology?
Answer Choices:
A. The tension between those who hold Ph.D.’s and those who hold Psy.D.s
B. The tendency of psychologists to identify with a specific perspective or methodology
C. The tension between academic and clinical psychologists
D. The tension between the APA and the APS
Answer: B – The tendency of psychologists to identify with a specific perspective or methodology
Question: Koch believes that it is more realistic to refer to the discipline of psychology as _____ rather than as _____.
Answer Choices:
A. the science of psychology; psychological studies
B. psychological studies; the science of psychology
C. empirical; rational
D. rational; empirical
Answer: B – psychological studies; the science of psychology