1. To measure value, the concept of time value of money is used: A. to determine the interest rate paid on corporate debt. B. to ensure that expected future profits exceed current profits today. C. to bring the future benefits and costs of a project, measured by its expected profits, back to the present. D. to bring the future benefits and costs of a project, measured by its cash flows, back to the present. 2. Which of the following is an example of both a capital market and a primary market transaction? A. Ford Motor Company sells a new issue of common stock to raise funds through a public offering B. Microsoft common stock owned by an individual investor is sold to another investor C. No transactions occur in both primary and capital markets at the same time D. The U.S. Government sells 3-month Treasury Bills 3. ABX Corporation has current assets of RM10,000,000, current liabilities of RM4,500,000, inventory of RM1,000,000, and sales of RM12,000,000. What is the acid test ratio? A. 0.22 B. 1.67 C. 2.0 D. 2.2 4. LoLo Enterprise reported the following items for the current year: Sales = RM3,000,000; Cost of Goods Sold = RM1,500,000; Depreciation Expense = RM170,000; Administrative Expenses = RM150,000; Interest Expense = RM30,000; Marketing Expenses = RM80,000; and Taxes = RM300,000; LoLo's operating profit margin is equal to: A. 25.67%. B. 35.67%. C. 36.67%. D. 50.00%