a An investor wishes to buy a 250 room hotel for $32,000 per key The investor's bank is willing to lend an amount that would create a 60 loan to value (LTV) ratio loan How much is the bank willing to lend to the investor A $3,000,000 B $4,800,000 C $3,600,000 D $4,200,000 b A hospitality business owner pays $50,000 per year in interest on loans to her business The annual net operating income from her business is $220,000 What is this owner's debt coverage ratio A 2 0 times B 4 0 times C 2 4 times D 4 4 times c For investors, financing is the term used to describe the A length of time borrowed money is invested B methods utilized to obtain the money needed to invest C amount of money that must be raised to fund a new investment D estimated returns (ROI) to be generated by a specific investment d Which is the term used only to describe individuals or companies that are willing to take risks by initially financing promising new businesses A Equity Partners B Bankers C Venture capitalists D Capital Investors e For any profitable business investment, it is generally true that A the greater the financial leverage, the smaller the ROI achieved by the investor B the greater the financial leverage, the greater the ROI achieved by the investor C projects funded with more debt than equity will yield smaller investment returns D projects funded with more equity than debt will yield greater investment returns f An investor finances a $4,000,000 project with 80 debt and 20 equity The interest payment due on the debt in year one is 8 The investor achieves a net operating income of $600,000 from the project in year one What is this investor's equity ROI on the project in year one A 41 B 45 C 39 D 43 g Which purpose of capital budgeting is LEAST controlled directly by a business' owners A Establishment of a business B Increasing business efficiency C Compliance with the law D Expansion of a business h A restaurant manager has a capital lease The lease calls for a $2,000 per month lease payment, which includes $1,800 in principal and $200 in interest Prior to entering any information about the lease payments, the manager's operating income line on the USAR formatted income statement for this month shows a positive $20,000 What will be the lease is entered into the income statement A $19,800 B $18,000 C $18,200 D $20,000

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a. An investor wishes to buy a 250-room hotel for $32,000 per key. The investor's bank is willing to lend an amount that would create

a. An investor wishes to buy a 250-room hotel for $32,000 per key. The investor's bank is willing to lend an amount that would create a 60% loan to value (LTV) ratio loan. How much is the bank willing to lend to the investor?

	A.	$3,000,000
	B.	$4,800,000
	C.	$3,600,000
	D.	$4,200,000

b. A hospitality business owner pays $50,000 per year in interest on loans to her business. The annual net operating income from her business is $220,000. What is this owner's debt coverage ratio?

	A.	2.0 times
	B.	4.0 times
	C.	2.4 times
	D.	4.4 times

c. For investors, "financing" is the term used to describe the...

	A.	length of time borrowed money is invested.
	B.	methods utilized to obtain the money needed to invest.
	C.	amount of money that must be raised to fund a new investment.
	D.	estimated returns (ROI) to be generated by a specific investment.

d. Which is the term used only to describe individuals or companies that are willing to take risks by initially financing promising new businesses?

	A.	Equity Partners
	B.	Bankers
	C.	Venture capitalists
	D.	Capital Investors

e. For any profitable business investment, it is generally true that...

	A.	the greater the financial leverage, the smaller the ROI achieved by the investor.
	B.	the greater the financial leverage, the greater the ROI achieved by the investor.
	C.	projects funded with more debt than equity will yield smaller investment returns.
	D.	projects funded with more equity than debt will yield greater investment returns.

f. An investor finances a $4,000,000 project with 80% debt and 20% equity. The interest payment due on the debt in year one is 8%. The investor achieves a net operating income of $600,000 from the project in year one. What is this investor's equity ROI on the project in year one?

	A.	41%
	B.	45%
	C.	39%
	D.	43%

g. Which purpose of capital budgeting is LEAST controlled directly by a business' owners?

	A.	Establishment of a business
	B.	Increasing business efficiency
	C.	Compliance with the law
	D.	Expansion of a business

h. A restaurant manager has a capital lease. The lease calls for a $2,000 per month lease payment, which includes $1,800 in principal and $200 in interest. Prior to entering any information about the lease payments, the manager's operating income line on the USAR formatted income statement for this month shows a positive $20,000. What will be the lease is entered into the income statement?