1) Which of the following assets would be the most difficult to value?

- a 1968 red Mustang convertible

- a Caribbean vacation

- World War II memorabilia

- an uninhabited, privately -owned island

2) The main objective of corporate management is to

- maximize the value of the firm.

- minimize the value of all outstanding liabilities.

- behave in a socially responsible manner.

- Both A and B are true since minimizing outstanding liabilities maximizes firm value.

3) Which of the following is not a necessary condition of a perfect market?

- no risk

- no taxes

- no transaction costs

- no information differences among investors