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Unformatted text preview: Midterm Examination Day Section Business 312 Instructions: For qualitative questions, point form is not an acceptable answer. Do all questions in your answer booklet. Answers on this question sheet or other scrap paper will not be marked. 1. (10 marks) If break even sales increases (in either dollars or units), operating leverage has also increased. Discuss and comment on this assertion. 2. (10 marks) Suppose that your investments are your only source of income. You buy all of your financial assets at the beginning of the year and you sell them at the end of the year. List and discuss the reasons that your personal taxable income is not necessarily the same as the increase in your wealth over the year. 3. (5 marks) If the effective rate of interest over a 3 month holding period is 2%, what is the nominal per annum rate of interest compounded daily (365 days in a year). So lution 4. (10 marks) You make monthly payments on your mortgage of $1000. The rate of interest is 10% per annum compounded monthly. There are exactly 120 remaining payments on your mortgage. You have just made a payment and the next and upcoming payment is in exactly one...
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This note was uploaded on 03/31/2010 for the course BUS 316 taught by Professor Blazenko during the Winter '08 term at The University of British Columbia.
- Winter '08