VERSION 1 1 M I M E 3 1 0 E N G I N E E R I N G E C O N O M YE C O N O M Y Class Test #2 – Thursday, 23 March, 2006 – 90 minutesPRINT your family name / initial and record your student ID number in the spaces provided below. FAMILY NAME / INITIAL S O L U T I O N S STUDENT ID # This test consists of 22 multipleThis test consists of 22 multiple-choicechoice questions, and three problems with subquestions, and three problems with sub-questions requiring full solutions.questions requiring full solutions.There are no penalties for incorrect answers. The problems are worth a total of 30 points. MULTIPLE-CHOICE QUESTIONS Circle the correct answer on this test paper and record it on the computer answer sheet. PART 1. True or False Statements– Circle the correct answer on this paper and record it on the computer answer sheet. (1.5 points each for a total of 12) Note: There are no penalties for incorrect answers. 1. If a firm has to choose among a number of projects, some of which are mutually exclusive and some of which are independent, it must first determine the best of each group of mu-tually exclusive alternatives. Then, the best of the acceptable independent projects can be selected. A) True B) False 2. To increase its production capacity, a firm is considering three options: 1) to expand its plant; 2) to acquire another company; 3) to contract with another company for production. These three options are examples of independent projects. A) True B) False 3. The specific cost of each source of financing is the after-tax cost of obtaining the financing using the historically based cost reflected by the existing financing on the firm's books. A) True B) False
has intentionally blurred sections.
Sign up to view the full version.