Answer:
False
Question: Time lines cannot be constructed for annuities unless all the payments occur at the end of the periods. True False
Answer:
False
Question: Which of the following statements is CORRECT?
Answer Options:
a. If you have a series of cash flows, each of which is positive, you can solve for I, where the solution value of I causes the PV of the cash flows to equal the cash flow at Time 0.
b. If you have a series of cash flows, and CF0 is negative but each of the following CFs is positive, you can solve for I, but only if the sum of the undiscounted cash flows exceeds the cost.
c. To solve for I, one must identify the value of I that causes the PV of the positive CFs to equal the absolute value of the FV of the negative CFs. It is impossible to find the value of I without a computer or financial calculator.
d. If you solve for I and get a negative number, then you must have made a mistake.
e. If CF0 is positive and all the other CFs are negative, then you cannot solve for I.
Answer:
e
Question: Time lines cannot be constructed in situations where some of the cash flows occur annually but others occur quarterly. True False
Answer:
False
Question: When a loan is amortized, a relatively low percentage of the payment goes to reduce the outstanding principal in the early years, and the principal repayment’s percentage increases in the loan’s later years. True False
Answer:
True
Question: Some of the cash flows shown on a time line can be in the form of annuity payments but none can be uneven amounts. True False
Answer:
False
Question: Disregarding risk, if money has time value, it is impossible for the present value of a given sum to exceed its future value. True False
Answer:
True
Question: Assume that Besley Golf Equipment commenced operations on January 1, 2014, and it was granted permission to use the same depreciation calculations for shareholder reporting and income tax purposes. The company planned to depreciate its fixed assets over 15 years, but in December 2014 management realized that the assets would last for only 10 years. The firm’s accountants plan to report the 2014 financial statements based on this new information. How would the new depreciation assumption affect the company’s financial statements? A) The firm’s reported net fixed assets would increase. B) The firm’s EBIT would increase. C) The firm’s reported 2014 earnings per share would increase. D) The firm’s cash position in 2014 and 2015 would increase. E) The provision will increase the company’s tax payments.
Answer:
D
Question: Which of the following statements is NOT CORRECT? a. Any bond sold outside the country of the borrower is called an international bond. b. Foreign bonds and Eurobonds are two important types of international bonds. c. Foreign bonds are bonds sold by a foreign borrower but denominated in the currency of the country in which the issue is sold. d. The term Eurobond applies only to foreign bonds denominated in U.S. currency. e. A Eurodollar is a U.S. dollar deposited in a bank outside the U.S.
Answer:
d. The term Eurobond applies only to foreign bonds denominated in U.S. currency.
Question: Which of the following statements is CORRECT? a. The statement of cash flows reflects cash flows from operations, but it does not reflect the effects of buying or selling fixed assets. b. The statement of cash flows shows where the firm’s cash is located; indeed, it provides a listing of all banks and brokerage houses where cash is on deposit. c. The statement of cash flows reflects cash flows from continuing operations, but it does not reflect the effects of changes in working capital. d. The statement of cash flows reflects cash flows from operations and from borrowings, but it does not reflect cash obtained by selling new common stock. e. The statement of cash flows shows how much the firm’s cash, the total of currency, bank deposits, and short-term liquid securities (or cash equivalents), increased or decreased during a given year.
Answer Options:
a. The statement of cash flows reflects cash flows from operations, but it does not reflect the effects of buying or selling fixed assets.
b. The statement of cash flows shows where the firm’s cash is located; indeed, it provides a listing of all banks and brokerage houses where cash is on deposit.
c. The statement of cash flows reflects cash flows from continuing operations, but it does not reflect the effects of changes in working capital.
d. The statement of cash flows reflects cash flows from operations and from borrowings, but it does not reflect cash obtained by selling new common stock.
e. The statement of cash flows shows how much the firm’s cash, the total of currency, bank deposits, and short-term liquid securities (or cash equivalents), increased or decreased during a given year.
Answer:
e
Question: Which nursing intervention has the highest priority for a patient diagnosed with bulimia nervosa? a. Assist the patient to identify triggers to binge eating. b. Provide corrective consequences for weight loss. c. Explore patient needs for health teaching. d. Assess for signs of impulsive eating.
Answer Options:
a. Assist the patient to identify triggers to binge eating.
b. Provide corrective consequences for weight loss.
c. Explore patient needs for health teaching.
d. Assess for signs of impulsive eating.
Answer:
A
Question: A $50,000 loan is to be amortized over 7 years, with annual end-of-year payments. Which of these statements is CORRECT? a. The annual payments would be larger if the interest rate were lower. b. If the loan were amortized over 10 years rather than 7 years, and if the interest rate were the same in either case, the first payment would include more dollars of interest under the 7-year amortization plan. c. The proportion of each payment that represents interest as opposed to repayment of principal would be lower if the interest rate were lower. d. The last payment would have a higher proportion of interest than the first payment. e. The proportion of interest versus principal repayment would be the same for each of the 7 payments.
Answer:
c. The proportion of each payment that represents interest as opposed to repayment of principal would be lower if the interest rate were lower.
Question: Which of the following statements is CORRECT, assuming positive interest rates and holding other things constant? a. The present value of a 5-year, $250 annuity due will be lower than the PV of a similar ordinary annuity. b. A 30-year, $150,000 amortized mortgage will have larger monthly payments than an otherwise similar 20-year mortgage. c. A bank loan’s nominal interest rate will always be equal to or greater than its effective annual rate. d. If an investment pays 10% interest, compounded quarterly, its effective annual rate will be greater than 10%. e. Banks A and B offer the same nominal annual rate of interest, but A pays interest quarterly and B pays semiannually. Deposits in Bank B will provide the higher future value if you leave your funds on deposit.
Answer:
d. If an investment pays 10% interest, compounded quarterly, its effective annual rate will be greater than 10%.
Question: An appropriate intervention for a patient diagnosed with bulimia nervosa who binges and purges is to teach the patient what important intervention? a. Eat a small meal after purging. b. Avoid skipping meals or restricting food. c. Concentrate oral intake after 4 pm daily. d. Understand the value of reading journal entries aloud to others.
Answer Options:
a. Eat a small meal after purging.
b. Avoid skipping meals or restricting food.
c. Concentrate oral intake after 4 pm daily.
d. Understand the value of reading journal entries aloud to others.
Answer:
B