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1 Which one of the following is the primary difference between operating cash flow and net income? interest expense indirect costs taxes fixed costs depreciation
1
- Which one of the following is the primary difference between operating cash flow and net income?
interest expense indirect costs taxes fixed costs depreciation
0.5 points
QUESTION 2
- A firm has a price-cash flow ratio of 12.5 and a price-book value ratio of 7.6. If the cash flow per share is $4.67, what is the book value per share?
$2.84 $3.55 $4.44 $6.45 $7.68
0.5 points
QUESTION 3
- What is the investment cash flow, given the following information?
-$20 -$10 $10 $20 $100
0.5 points
QUESTION 4
- Which one of the following represents the amounts owed by a firm to other parties?
assets cash inflows equities liabilities expenses
0.5 points
QUESTION 5
- Which one of the following is most apt to vary directly with sales?
current assets long-term debt shareholders' equity paid-in capital retained earnings
0.5 points
QUESTION 6
- What is the investment cash flow?
-$220 -$140 -$120 -$20 -$10
- Which one of the following is a mortgage-backed security that has first priority to scheduled principal payments?
priority strip bond principal strip amortized principal strip protected amortization class bond principal priority tranche
0.5 points
QUESTION 2
- How are the cash flows allocated when actual prepayments fall below a PAC collar's lower bound?
The entire cash flow is paid to the non-PAC support bonds until those bonds are paid in full. The cash flows are divided between PAC and non-PAC bonds on a pro-rata basis. PAC payments are recomputed to a reduced fixed amount. The entire cash flow is paid to the PAC bondholders. The interest income is paid to the non-PAC bondholders with all principal amounts paid to the PAC bondholders.
0.5 points
QUESTION 3
- Which one of the following correctly applies to a mortgage passthrough bond?
The primary collateral for the bond is the underlying pool of mortgages. All interest received is immediately passed through while principal payments are held until the bond matures. Each bond represents one home mortgage. These bonds are created via a process known as mortgage collaring. All of these bonds are guaranteed by the full faith and credit of the U.S. government.
0.5 points
QUESTION 4
- You just purchased a GNMA mortgage-backed security. Which one of the following should you expect to receive?
fixed monthly payments fixed quarterly payments variable monthly payments variable quarterly payments quarterly payments that decrease at a constant rate
0.5 points
QUESTION 5
- Which one of the following is the measure of interest rate risk for fixed-income securities?
standard deviation Macaulay duration variance Jensen's alpha beta
0.5 points
QUESTION 6
- Which one of the following set of mortgage terms will cause the borrower to pay the most interest, assuming the mortgage is paid according to the amortization schedule?
10-year, 6.5 percent 10-year, 7.0 percent 15-year, 7.0 percent 30-year, 6.5 percent 30-year, 7.0 percent
0.5 points
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