Archives: Quiz
Finance Chapter 10 1 While sensitivity analysis is forward-looking, scenario analysis attempts to reconstruct and analyze the past
1. A capital budget shows a proposed list of investments. TRUE AACSB: Communication Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 10-01 Appreciate the practical problems of capital budgeting in large corporations. Topic: Capital budgeting 2. The strategic […]
Finance Chapter 12 1 When does the IRS consider a transaction to be non-taxable to the target firm’s shareholders? What is the justification for the IRS’ position
Chapter 12: Structuring the Deal: Tax and Accounting Considerations Answers to End of Chapter Discussion Questions 12.1 When does the IRS consider a transaction to be non–taxable to the target firm’s shareholders? What is the justification for the IRS’ position? […]
Human Resources Chapter 7 3 Which of the following is an on-the-job training program that is generally sponsored by an educational institution as a component of an academic program
54. Which of the following is an example of an on-the-job training method? A. Bumping B. Benchmarking C. Apprenticeship D. Adventure learning E. Action learning Apprenticeship is an example of an on-the-job training method. Blooms: Remember Difficulty: 1 Easy Learning […]
Finance Chapter 9 3 Which one of the following is representative of how depreciation expense is handled in the face of inflation
AACSB: Reflective Thinking Accessibility: Keyboard Navigation Blooms: Apply Difficulty: 2 Medium Learning Objective: 09-01 Identify the cash flows from a proposed new project. Topic: Project analysis and evaluation 86. A parcel of corporate land was recently dedicated as the new […]
Finance Chapter 11 2 Explain how differing assumptions about market growth, potential synergies, and the size of the potential liability related to product recalls affected the bidding
19 2. What might J&J have done differently to avoid igniting a bidding war? Answer: Immediately following its announcement that it had reached an agreement to be acquired by Johnson and Johnson (J&J), Guidant defibrillators became embroiled in a regulatory […]
Human Resources Chapter 7 2 Which of the following processes identifies the knowledge, skills, and behaviors that training should emphasize
34. Which of the following help a manager identify which employees need training? A. Person analysis B. Organization analysis C. Task analysis D. Trend analysis E. Regression analysis The person analysis is a process for determining individuals’ needs and readiness […]
Finance Chapter 9 2 Which one of the following would be more apt to make an unacceptable project appear acceptable
48. The likely effect of discounting nominal cash flows with real interest rates will be to: A. make an investment’s NPV appear more attractive. B. make an investment’s NPV appear less attractive. C. correctly calculate an investment’s NPV if inflation […]
Finance Chapter 11 1 What are the advantages and disadvantages of a purchase of stock from the perspective of the buyer and seller?
Chapter 11: Structuring the Deal: Payment and Legal Considerations Answers to End of Chapter Discussion Questions 11.1 What are the advantages and disadvantages of a purchase of assets from the perspective of the buyer and seller? 11.2 What are the […]
Human Resources Chapter 7 1 Training refers to any planned effort by a firm to facilitate the learning of job-related knowledge, skills, or behavior by employees
1. Training refers to any planned effort by a firm to facilitate the learning of job-related knowledge, skills, or behavior by employees. TRUE Training consists of an organization’s planned efforts to help employees acquire job-related knowledge, skills, abilities, and behaviors, […]
Finance Chapter 9 1 Accurate capital budgeting analysis depends on total cash flows as opposed to incremental cash flows
1. Capital budgeting analysis focuses on cash flow as opposed to profits. TRUE AACSB: Communication Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 09-01 Identify the cash flows from a proposed new project. Topic: Cash flows 2. Accurate […]
Finance Chapter 10 2 Mill was recapitalized just prior to completing its merger with Allied. What was the purpose of the recapitalization
lawsuit alleged that the firm’s public statements about the efficacy of its technology and order backlog were highly inflated. Huiheng and its codefendants settled out of court in 2010 with no admission of liability by buying back some of its […]
Finance Chapter 8 3 To justify postponing a project for one year, the NPV needs to increase over that year by a rate that is equal to or greater than
85. A project’s payback period is determined to be 4 years. If it is later discovered that additional cash flows will be generated in years 5 and 6, then the project’s payback period will: A. be reduced. B. be increased. […]
Finance Chapter 10 1 For privately held firms, firm specific risk may include lack of product, industry, and geographic diversification
Chapter 10: Analysis and Valuation of Privately Held Companies Answers to End of Chapter Discussion Questions 10.1 What is the capitalization rate and how does it relate to the discount rate? 10.2 What are the common ways of estimating the […]
Human Resources Chapter 6 4 Sean is looking for candidates who are expressive and convincing with customers. He also wants the candidates to be friendly and social
74. In-basket tests are an example of _____ tests. A. job performance B. physical ability C. honesty D. personality E. cognitive ability Job performance testing may involve a simulated work environment, a difficult team project, or a complex computer programming […]
Finance Chapter 8 2 When managers cannot determine whether to invest now or wait until costs decrease later, the rule should be to
46. As long as the NPV of a project declines smoothly with increases in the discount rate, the project is acceptable if its: A. internal rate of return is positive. B. payback period is greater than one. C. rate of […]
Finance Chapter 8 1 Because of deficiencies associated with the payback method, it is seldom used in corporate financial analysis today
1. As the opportunity cost of capital decreases, the net present value of a project increases. TRUE AACSB: Reflective Thinking Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 1 Easy Learning Objective: 08-01 Calculate the net present value of a project. Topic: […]
Finance Chapter 8 2 Despite their limitations, why is the judicious application of the various valuation methods critical to the acquirer in determining an appropriate purchase price?
14 a. Assumes that markets are efficient such that current values reflect all the information currently known about the business b. Current values represent what a willing buyer and seller are willing to pay for a business in the absence […]
Finance Chapter 7 4 Studies indicate that stocks of firms with the best earnings news outperform the stocks of firms with the worst earnings news for at least six months
AACSB: Reflective Thinking Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 2 Medium Learning Objective: 07-05 Understand what professionals mean when they say that there are no free lunches on Wall Street. Topic: Fundamental and technical analysis 99. Studies indicate that stocks […]
Finance Chapter 7 3 What is the minimum amount shareholders should expect to receive in the event of a complete corporate liquidation
71. Which of the following is true for a firm having a stock price of $42, an expected dividend of $3, and a sustainable growth rate of 8%? A. It has a required return of 15.14%. B. It has a […]
Finance Chapter 7 1 What is the significance of the weighted average cost of capital? How is it calculated? Do the weights reflect the firm’s actual or target debt to total capital ratio?
Chapter 7: Merger and Acquisition Cash Flow Valuation Basics Answers to End of Chapter Discussion Questions 7.1 What is the significance of the weighted average cost of capital? How is it calculated? Do the weights reflect the firm’s actual or […]
Finance Chapter 7 2 When valuing stock with the dividend discount model, the present value of future dividends will
44. If the dividend yield for year 1 is expected to be 5% based on a stock price of $25, what will the year 4 dividend be if dividends grow annually at a constant rate of 6%? A. $1.33 B. […]
Finance Chapter 6 2 What are the major challenges the management of the combined companies are likely to face? How would you recommend resolving these issues
focused on the need to achieve integration on a timely basis while minimizing disruption to daily operations if planned synergies were to be realized. Nevertheless, despite the hard work and commitment of those involved in the process, history shows that […]
Finance Chapter 7 1 The dividend discount model indicates that the value of a stock is the present value of the dividends it will pay over the investor’s horizon
1. The dividend discount model indicates that the value of a stock is the present value of the dividends it will pay over the investor’s horizon, plus the present value of the expected stock price at the end of that […]
Finance Chapter 6 3 What are the conditions imposed on a debt issuer that are designed to protect bondholders called
82. How much should you be prepared to pay for a 10-year bond with an annual coupon of 6% and a yield to maturity of 7.5%? A. $411.84 B. $897.04 C. $985.00 D. $1,000.00 Price = (.06 × $1,000) {(1/.075) […]
Finance Chapter 5 2 How would you characterize the Oracle business strategy (i.e., cost leadership, differentiation, niche, or some combination of all three
getting the disparate software applications to work together. Although some buyers still prefer to purchase the “best of breed” software, many are moving to purchase suites of applications that are compatible. In response to these industry changes and the maturing […]
Human Resources Chapter 6 3 Which of the following details need to be asked in an application form to gather information about suitable candidates
53. Which of the following details need to be asked in an application form to gather information about suitable candidates? A. Marital status B. History of disabilities C. Number of children D. Educational background E. Applicant’s race The application form […]
Finance Chapter 6 2 If a bond investor’s rate of return for a particular period equaled the bond’s coupon rate, then during that period, the bond’s price
Rate of return = [$1,037.19 + (.065 × $1,000) – $1,054.47]/$1,054.47 = .0453, or 4.53% AACSB: Analytic Accessibility: Keyboard Navigation Blooms: Analyze Difficulty: 2 Medium Learning Objective: 06-02 Find the market price of a bond given its yield to maturity; […]
Human Resources Chapter 6 2 She wants to establish the validity of a test designed for computer technicians using a predictive criterion-related validation strategy
33. The _____ of an employment test is indicated by the extent to which the test scores relate to the actual job performance. A. reliability B. validity C. generalizability D. utility E. dependability For a selection measure, validity describes the […]
Finance Chapter 6 1 When the market interest rate exceeds the coupon rate, bonds sell for less than face value to provide enough compensation to investors
1. A bond’s payment at maturity is referred to as its face value. TRUE AACSB: Communication Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 06-01 Distinguish among a bond’s coupon rate; current yield; and yield to maturity. Topic: […]
Human Resources Chapter 6 1 A predictive criterion-related validation strategy correlates job incumbents’ scores on a test with existing measures of their performance
1. The process of selecting employees remains constant for all organizations and for all jobs. FALSE The process of selecting employees varies considerably from organization to organization and from job to job. AACSB: Analytic Blooms: Remember Difficulty: 1 Easy Learning […]
Finance Chapter 5 4 What is the annually compounded rate of interest on an account with an APR of 10% and monthly compounding
90. What is the annually compounded rate of interest on an account with an APR of 10% and monthly compounding? A. 10.00% B. 10.47% C. 10.52% D. 11.05% EAR = [1 + (.10/12)] 12 – 1 = .1047, or 10.47% […]
Human Resources Chapter 5 5 The recruiter gives some background information to Sharon about the positive and negative qualities of the job
89. To compute _____, find the cost of using a particular recruitment source for a particular type of vacancy. Then divide that cost by the number of people hired to fill that type of vacancy. A. cost per hire B. […]
Finance Chapter 5 5 What is the difference between real and nominal cash flows and between real and nominal interest rates
106. A loan officer states, “Thousands of dollars can be saved by switching to a 15-year mortgage from a 30-year mortgage.” Calculate the difference in payments on a 30-year mortgage at 9% interest versus a 15-year mortgage with 8.5% interest. […]
Finance Chapter 3 2 Using the information in this case study, discuss the arguments for and against encouraging hostile corporate takeovers
19 In late 2005, Arcelor outbid German steelmaker Metallgeschaft to buy Canadian steelmaker Dofasco for $5 billion. Mittal was proposing to sell Dofasco to raise money and avoid North American antitrust concerns. Following completion of the Dofasco deal in April […]
Finance Chapter 5 3 What is the expected real rate of interest for an account that offers a 12% nominal rate of return when the rate of inflation is 6% annually
65. What will be the monthly payment on a home mortgage of $75,000 at 12% interest, to be amortized over 30 years? A. $771.46 B. $775.90 C. $1,028.61 D. $1,034.53 Payment = $75,000/[(1/.01) – 1/.01(1.01)360] Payment = $771.46 AACSB: Analytic […]
Finance Chapter 5 2 to be repaid in three equal, annual payments with 10% interest. Approximately how much principal is amortized with the first payment
41. If the future value of an annuity due is $25,000 and $24,000 is the future value of an ordinary annuity that is otherwise similar to the annuity due, what is the implied discount rate? A. 1.04% B. 4.17% C. […]
Finance Chapter 2 2 What alternative actions could the government take to limit market power resulting from a business combination
Some industries are more prone to increasing concentration because of their high capital needs. Only the largest and most financially viable can support the capital outlays required to support national telecom networks. While the U.S. Justice Department has sent a […]
Finance Chapter 5 1 Compound interest pays interest for each time period on the original investment plus the accumulated interest.
1. Compound interest pays interest for each time period on the original investment plus the accumulated interest. TRUE AACSB: Communication Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 05-01 Calculate the future value of money that is invested […]
Finance Chapter 2 1 Whose interests do you believe antitrust regulators represent? What trade-offs do antitrust regulators face in making decisions
Chapter 2 The Regulatory Environment Answers to End of Chapter Discussion Questions 2.1 What factors do U.S. antitrust regulators consider before challenging a merger or acquisition? 2.2 What are the obligations of the acquirer and target firms according to Section […]
Finance Chapter 4 4 After calculating a firm’s financial ratios, in what manner might they be analyzed to assess the firm’s performance
Thus, all three ratios double when the denominator is cut in half. AACSB: Analytic Blooms: Evaluate Difficulty: 3 Hard Learning Objective: 04-03 Calculate and interpret key measures of operating efficiency; leverage; and liquidity. Topic: Short-term solvency ratios 99. A firm […]
Human Resources Chapter 4 5 Job analysis is so important to HR managers that it has been called the building block of everything that personnel do
87. Which of the following is NOT a strategy used by OSHA to increase ergonomic job design? A. Issuing regulations and guidelines for industries B. Directing ergonomic research along specific lines C. Providing licenses to new companies only when they […]
Finance Chapter 4 3 Instead of increasing its long-term debt by borrowing money from a bank to purchase new stereo equipment, Jay’s Jams Inc
74. What is the residual income for a firm with $1 million in total capital, $300,000 in net income, and a 20% cost of capital? A. $100,000 B. $140,000 C. $240,000 D. $500,000 Residual income = net income – (cost […]
Finance Chapter 1 1 What are the primary differences between operating and financial synergy? Give examples to illustrate your statements
Chapter 1: Introduction to Mergers, Acquisitions, and Other Restructuring Activities Answers to End of Chapter Discussion Questions 1.1 Discuss why mergers and acquisitions occur. 1.2 What is the role of the investment banker in the M&A process? Answer: Investment bankers […]
Human Resources Chapter 4 4 According to Herzberg’s two-factor theory, which of the following factors would motivate individuals the most
73. According to Herzberg’s two-factor theory, which of the following factors would motivate individuals the most? A. Meaningfulness of a job B. Fringe benefits in the job C. Share in company stock D. Salary and allowances E. Periodic bonuses According […]
Finance Chapter 4 2 Which one of these changes indicates an improvement in a firm’s asset management efficiency
AACSB: Analytic Accessibility: Keyboard Navigation Blooms: Analyze Difficulty: 1 Easy Learning Objective: 04-02 Calculate and interpret key measures of financial performance; including economic value added (EVA) and rates of return on capital; assets; and equity. Topic: Profitability ratios 44. After-tax […]
Human Resources Chapter 4 3 a regional branch manager for a leading automobile company in the U.S., decides to design a manufacturing job based on the principles of industrial engineering
53. A limitation in using the PAQ is that it _____. A. applies exclusively to similar job profiles B. measures only the inputs of a work process C. fails to provide computerized reports D. requires incumbents to spend time filling […]
Finance Chapter 4 1 The income statement of a firm shows the value of its assets and liabilities over a specified period of time.
1. The income statement of a firm shows the value of its assets and liabilities over a specified period of time. FALSE AACSB: Reflective Thinking Accessibility: Keyboard Navigation Blooms: Understand Difficulty: 1 Easy Learning Objective: 04-02 Calculate and interpret key […]
Human Resources Chapter 4 2 Which of the following is an appropriate course of action while formulating job descriptions
33. In the context of a work flow analysis, materials, equipment, and human resources needed to perform the tasks collectively constitute the _____. A. outputs B. jobs C. work processes D. operating procedures E. inputs Inputs fall into three categories: […]
Finance Chapter 3 4 Discuss reasons why a market-value balance sheet may be distinctly different from a book-value balance sheet
108. What is the change in cash for a firm with the following: $10,000 cash flow from operations, $1,600 cash used for new investment, a reduction in the level of debt of $2,000, $1,000 in cash dividends, and $200 in […]
Finance Chapter 3 3 Which one of the following statements is correct for a corporation with a negative net income in both the present and the last fiscal year
AACSB: Communication Accessibility: Keyboard Navigation Blooms: Remember Difficulty: 1 Easy Learning Objective: 03-01 Interpret the information contained in the balance sheet; income statement; and statement of cash flows. Topic: Generally Accepted Accounting Principles (GAAP) 88. Which of these statements related […]