1. Question: Which ratio would you use to measure how effectively the firm uses the money shareholders have invested?

    A
    Return on assets

    B
    Profit margin

    C
    Earnings per share

    D
    Price earnings ratio

    E
    Return on equity

    Note: Not available
    1. Report
  2. Question: Which of the following types of firms may operate with high operating leverage?

    A
    A doctor's office

    B
    An auto manufacturing facility

    C
    A mental health clinic

    D
    None of these would have high operating leverage

    Note: Not available
    1. Report
  3. Question: What is meant by "the goal of the corporation is to maximize shareholder wealth"?

    A
    Pay out dividends

    B
    Maximize profits

    C
    Achieve the highest possible value for the firm

    D
    Control costs

    E
    Increase sales

    Note: Not available
    1. Report
  4. Question: Which of the following is considered a profitability measure?

    A
    Day's sales in inventory

    B
    Fixed asset turnover

    C
    Price-earnings ratio

    D
    Cash coverage ratio

    E
    Return on Assets

    Note: Not available
    1. Report
  5. Question: Which is/are the primary financial statements used to measure liquidity?

    A
    Balance Sheet

    B
    Income Statement

    C
    Balance Sheet and Income Statement

    D
    Cash Flow Statement and Balance Sheet

    Note: Not available
    1. Report
  6. Question: What does CAPM stand for?

    A
    Current Asset Pricing Model

    B
    Capital Asset Pricing Model

    C
    Current Average Product Model

    D
    Capital Average Product Model

    Note: Not available
    1. Report
  7. Question: Which is a characteristic of an efficient market?

    A
    Stock prices are high

    B
    Prices adjust rapidly to new information

    C
    Stock prices are low

    D
    Trading is difficult

    E
    There are only small daily changes in price

    Note: Not available
    1. Report
  8. Question: What does Return on Assets indicate?

    A
    How well a company employs its capital investments

    B
    How much cash the company has generated over the last year

    C
    How much debt the company has to pay relative to its asset base

    D
    How profitable a company is before leverage

    Note: Not available
    1. Report
  9. Question: Which of the following would not be included in a balance sheet?

    A
    Accounts receivable

    B
    Accounts payable

    C
    Sales

    D
    Cash

    Note: Not available
    1. Report
  10. Question: Gerald's had opening total stockholders' equity of $160,000. During the year, total assets increased by $240,000 and total liabilities increased by $120,000. Their net income was $180,000. No additional investments were made. However, some amount was paid as dividend during the year. What was the amount of the dividend paid?

    A
    $20,000

    B
    $60,000

    C
    $140,000

    D
    $220,000

    Note: Not available
    1. Report
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