bam_313_final- - 1 thecurrentyear. by5,butthecompanys...

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1. the current year. The change results in reported profits increasing  by 5%, but the company’s cash flows are not changed. If capital markets are efficient, then:  The stock price will increase only if the accounting change will  also result in higher a. profits in the next year. The stock price will increase due to higher  profits. b. The stock price will decrease because accounting method changes  are not permitted c. under generally accepted accounting principles. The stock price will not be affected by the accounting  change. d. S-type corporations have all of the following advantages  EXCEPT 2. The owners have limited  liability. a. All owners must be people, no corporations. b. Distributions are taxed twice, similar to corporate dividend  payments. c. They are taxed as partnerships. d. Assume that you went to Las Vegas and hit the jackpot for $5  million. Further assume that 3. you were offered a choice to receive the $5 million today, or receive it  in two years. According to one of the principles of finance, which would you take? You would be indifferent as to when you would receive the $5  million. a.
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$5 million in two years because you would be afraid of spending it  all right away
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b. $ 5 million today because it would be worth more than if you  would receive it in two years c. $5 million in two years because it would be worth more than if  you would receive it today d. In terms of the costs to organize each, which of the  following sequences is correct, moving 4. from highest to lowest cost? corporation, limited partnership, general partnership, sole  proprietorship a. sole proprietorship, general partnership, corporation, limited  partnership b. general partnership, sole proprietorship, limited partnership,  corporation c. sole proprietorship, general partnership, limited partnership,  corporation d. Which form of organization is free of initial legal  requirements? 5. general partnership a. sole  proprietorship b. corporation c. both a and b d. 4 Final Examination BAM 313 Introduction to Financial Management  Which of the statements below are true?
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