Sample Test One-updated - Math 3650 Sample Test Questions...

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Math 3650 Sample Test Questions Test One – Chapters 1-8, 24 The questions below are taken from actual prior tests. This is meant to give you an idea of the types of questions you may encounter on your test. Note: This is NOT intended as an indicative exam. Your test may include more or fewer questions of a particular type (calculations, short answer, or long answer) and the questions may, of course, be from any area mentioned on your test topic study list. The purpose of this is simply to give you an idea of the types of questions that may be asked.
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1. You are given the following information about a company: Throughout 2008 and 2009 the total shares outstanding were a constant 3 million shares. The price per share was $12.00 on 12/31/2009 Income Statement (all values are in Thousands of dollars) 2008 2009 Sales 40,000 42,000 Operating Expenses 37,000 37,500 Operating Income 3,000 4,500 Non-Operating Income and expense (300) (400) Income Before Taxes 2,700 4,100 Taxes 918 1,394 Net Income 1,782 2,706 Balance Sheet (all values are in Thousands of dollars) 2008 2009 Assets Cash and equivalents 2,600 3,000 Other Current Assets 1,200 2,400 Long Term Assets 6,000 5,600 Total Assets 9,800 11,000 Liabilities Accounts Payable 2,800 3,200 Short Term Debt 700 600 Other Current Liabilities 900 1,000 Long Term Debt 4,000 4,000 Total Liabilities 8,400 8,800 a. Calculate the company’s 2009 Operating Margin b. Calculate the company’s 2009 Price/Earnings ratio c. Calculate the company’s Enterprise Value as of 12/31/2009 d. Calculate the company’s Current Ratio as of 12/31/09 e. Calculate the company’s Market to Book Ratio as of 12/31/09 2. Which of the following are examples of arbitrage? Note: there may be more than one.
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a. An investor buys a 10 year US Treasury note and then sells the coupon payments and maturity payments separately for a higher combined price than what she paid for the note, thereby making an instant profit.
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