04%20stocks%20test%20bank%20problems

04%20stocks%20test%20bank%20problems - FNAN 301 Test bank...

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FNAN 301 Test bank problems – stocks 1. Driver Corporation has issued bonds, common stock, and preferred stock. Rank the following in terms of their priority on Driver’s cash flows from highest to lowest: bondholders, common shareholders, and preferred shareholders. 2. Rogers Corporation has issued bonds, common stock, and preferred stock. a. Which of the three securities is most likely to be the most risky? b. Which of the three securities is most likely to be the least risky? c. Which of the three securities is most likely to be neither the most nor the least risky? 3. Van London Corporation has issued bonds, common stock, and preferred stock. Which group, bondholders, common shareholders, or preferred shareholders, is most likely to have the most control over the management of the corporation? 4. Which one of the assertions is true? Assume running a company can be done directly or indirectly. A. Common shareholders, preferred shareholders, and bondholders are the primary groups of investors that run a company B. Common shareholders and preferred shareholders are the primary groups of investors that run a company C. Common shareholders and bondholders are the primary groups of investors that run a company D. Preferred shareholders and bondholders are the primary groups of investors that run a company E. Common shareholders make up the primary group of investors that runs a company F. Preferred shareholders make up the primary group of investors that runs a company G. Bondholders make up the primary group of investors that runs a company H. Neither common shareholders, preferred shareholders, nor bondholders is the primary group of investors that run a company 5. On Monday, 2 million shares of Brooks Books stock were bought by a variety of investors for $10 per share. Brooks Books received $20 million from the sale of these stock shares. Were the 2 million shares most likely sold on the primary market or the secondary market? 6. On Monday, 2 million shares of Brooks Books stock were bought by a variety of investors for $10 per share. Brooks Books received nothing from the sale of these stock shares. Were the 2 million shares most likely sold on the primary market or the secondary market? 7. Indicate whether the following assertion is generally true or false: When a company performs very well, the dividends paid to its common shareholders are frequently raised. 8. Indicate whether the following assertion is generally true or false: When a company performs very poorly, the dividends paid to its common shareholders may be reduced. 9. Indicate whether the following assertion is generally true or false: When a company performs very well, the dividends paid to its preferred shareholders are frequently raised. 10. Indicate whether the following assertion is generally true or false: When a company performs very poorly, the dividends paid to its preferred shareholders may be reduced.
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04%20stocks%20test%20bank%20problems - FNAN 301 Test bank...

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