1.The ________ decisions involves determining the appropriate make-up of the right-hand side of the balance sheet.

Select one:

Asset Management

Investment

Financing

Capital Budgeting

2.The CEO of a publicly-traded company reports directly to

Select one:

The Audit Committee

The Shareholders

The Chief Operating Officer

The Board of Directors

3.A market where new securities are bought and sold for the first time is known as a __________ market.

Select one:

money

capital

secondary

primary

4.The difference between a public limited company (PLC) and a private limited company (Ltd) is that:

Select one:

The "PLC" has limited liability

The "PLC" can sell shares on the open market such as the Australian Stock Exchange (ASX)

The "Ltd" doesn't have share

The PLC has shareholders

5.The cash conversion cycle is

Select one:

Shorter than the operating cycle because it only begins when a company pays for its inventory

The same as the operating cycle

Calculated by adding days payables outstanding to the operating cycle

Longer than the operating cycle because it only begins when a company pays for its inventory

6.Which of the following is not consistent with a flexible current asset investment strategy?

Select one:

Paying suppliers early

Holding a large inventory

Investing in short term liquid securities

Holding extra cash

7.You invested $600 in a security with a beta of 1.2 and $400 in another with a beta of 0.90. The beta of the resulting portfolio is

Select one:

0.8

1.00

1.40

1.08

8.The risk reduction of a two-asset portfolio is largest when the correlation between two assets is:

Select one:

+1

-1

0.2

0

9.By increasing the number of compounding periods in a year, while holding the stated annual interest rate constant, you will ________ .

Select one:

There is not enough information to answer the question

not change the effective annual rate

increase the effective annual rate

decrease the effective annual rate

10.What is the present value of a $15,000 ordinary annuity that earns 5% annually for an infinite number of periods?

Select one:

$7,500

$300,000

$150,000

$50,000