7.

The process of moving towards the adoption of one set of standards across the globe is referred as:

Select one:

Convergence.

Collectivism.

Conservatism.

All of the above.

8.

It has been found that prices often lead earnings. Why is this thought to be the case:

I. Accounting recognition criteria are less stringent for losses than for gains.

II. Accounting conservatism 'garbles' the true earnings signal about company value.

III. Accounting statements are poor at incorporating information about human capital and other intangibles.

IV. None of the above.

Select one:

I and III.

I, II, III.

II and III.

IV.

9.

Which of the following methods is commonly used to manipulate earnings:

I.Accounting policy choice.

II.Incorrect classification of current liabilities as non-current.

III.Accelerating expenses.

IV.Aggressive accounting for accruals.

Select one:

I, II, III and IV.

Only II.

I, III and IV.

II, III and IV.

12. Which of the following is not a conclusion of capital markets research?

Select one:

Accounting earnings are poor measures of relevant events that are incorporated into share price.

Forecasts of future performance are core to valuation.

Investors react more quickly to bad news than to good.

Accounting information is not used by investors.

4.

Which of the following is not true about Behavioural finance:

Select one:

Integrates psychology and economics.

It focuses on decision-making under uncertainty.

Shows that people rely heavily on heuristics.

Suggests individuals are rational decision makers.