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Easy Questions and Answers of FIN 370 Final Exam
(University of Phoenix) course.
1. Which financial statement reports the amounts of cash that the firm
generated and distributed during a particular time period?
Income statement
Balance sheet
Expected returns
Coefficient of variation
Correlation coefficient
Standard deviation
6.1 percent
10.2 percent
6.0 percent
5.9 percent
1 Which financial statement reports a firm's assets, liabilities, and equity at a
particular point in time?
Balance sheet
Income statement
the cost of the stock being sold for the specific project
1 Will's Wheels, Inc. reported a debt-to-equity ratio of 0.65 times at the end of
2013. If the firm's total debt at year-end was $5 million, how much equity
does Will's Wheels have?
$3.25 million
$5 million
$7.69 million
$0.65 million
Substitutionary analysis
1 Which of these is the term for portfolios with the highest return possible for
each risk level?
Total portfolios
Efficient portfolios
Modern portfolios
Optimal portfolios
1 Which financial statement shows the total revenues that a firm earns and
the total expenses the firm incurs to generate those revenues over a
specific period of time generally one year?
Balance sheet
Income statement
1 What are the tools available for the manager in financial planning?
they apply to each asset as they are purchased with their respective forms
of debt or equity
Machine B
Machine A
Using a divisional WACC versus a WACC for the firm's current operations
will result in quite a few incorrect decisions.
Using a simple firmwide WACC to evaluate new projects would give an
unfair advantage to projects that present more risk than the firm's average
beta.
Investment banks
Secondary markets
Primary markets
Money markets
Diversification
1 The top part of Mars, Inc.'s 2013 balance sheet is listed as follows (in
millions of dollars). What are Mars, Inc.'s current ratio, quick ratio, and
cash ratio for 2013?
Coverage
Financial
Liquidity
Profitability
Board of directors
Auditors
Venture Capitalist
Agency relationship
1 Which of the following terms means that during periods when interest rates
change substantially, bondholders experience distinct gains and losses in
their bond investments?
7.73 percent
16.00 percent
8.40 percent
8.00 percent
1 Which of these does NOT perform vital functions to securities markets of
all sorts by channeling funds from those with surplus funds to those with
shortages of funds?
Commercial banks
Insurance companies
Mutual funds
Secondary markets
1 Five years ago, Jane invested $5,000 and locked in an 8 percent annual
interest rate for 25 years (ending 20 years from now). James can make a 20-
year investment today and lock in a 10 percent interest rate. How much
money should he invest now in order to have the same amount of money in
20 years as Jane?
$7,346.64
$3,160.43
$5,089.91
$3,464.11
1 We call the process of earning interest on both the original deposit and on
the earlier interest payments:
compounding.
multiplying.
computing.
discounting.
using the book value of the total assets divided by the number of shares
outstanding
1 A firm is expected to pay a dividend of $2.00 next year and $2.14 the
following year. Financial analysts believe the stock will be at their target
price of $75.00 in two years. Compute the value of this stock with a
required return of 10 percent.
$65.40
$65.57
$79.14
$66.67