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Chapter 5 Quiz
1. A credit card has an annual percentage rate of 12.9 percent and charges interest monthly.
The effective annual rate on this account: >12.9%
1. A loan has an APR of 8.5 percent and an EAR of 8.5 percent. Given this,
Four financial topics:
1. Corporate Finance
2. Investments- deal with financial assets such as stock and bonds. Career opportunities:
stockbrokers, portfolio management, security analysis
a. What determines price of financial assets?
b. What pot
Balance sheet- financial statement showing a firms accounting value on a particular date
Assets- on the left side of balance sheet and are classified at current or fixed.
Fixed is long term. Tangible or intangible
Current is short term and will
1. A bond has a $1,000 face value, a market price of $1,036, and pays interest payments of
$70 every year. What is the coupon rate? 70/1000= 7% or .07 interest payment/face value
2. A 6 percent bond has a yield to maturity of 6.5 percent. The bond
Finance Quiz 2
The marginal tax rate is used rather than the average tax rate when making an
investment decision. True
2) Net working capital is defined as: Current Assets minus Current Liabilities
3) Which one of the following terms is defined as the
1. You want to invest an amount of money today and receive back twice that amount in the
future. You expect to earn 8 percent interest. Approximately how long must you wait for
your investment to double in value? PV= -2, FV=4, I/Y= 8, CPT N=? N=9
1. The Jelly Jar has total assets of $79,600 and an equity multiplier of 1.35. What is the debt-equity
ratio? 1- DER= .35
2. A firm has total assets of $523,100, current assets of $186,500, current liabilities of $141,000,
and total debt of $215,000. What
Finance Quiz 1
Question 1 Which of the following form of business has agency problem"? Corporation
Question 2 What is the goal of a firm in Anglo-Saxon countries (including U.S. and U.K.)?
Maximizing Share Value
Question 3 What is the goal of a firm in Ge
S&P 500 Company: Coca-Cola
Being established on May 8, 1886 in Atlanta, Georgia, Coca-Cola has since gained billions
of dollars in revenue and has expanded globally beyond the borders of America to become a
leader in the b