Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please help me answer these questions thank you. Which of the following is a valid criticism concerning the goal of firms to maximize profits? Profit
please help me answer these questions thank you.
Which of the following is a valid criticism concerning the goal of firms to maximize profits? Profit maximization ignores expenses. There are no valid criticisms of profit maximization as a goal. Profit maximization is completely unrelated to shareholder wealth. Profitable firms may not be generating free cash flow. Question 2 (0.2 points) A takeover is an attempt to seize control of a corporation by purchasing the majority of its outstanding stock. True False Question 3 (0.2 points) Which one of the following is an example of a perpetuity? 1) Retirement pay of $2,200 a month for 20 years 2) Lottery winnings of $1,000 a month for life 3) Apartment rent payment of $800 a month for one year 4) Trust income of $1,200 a year forever 5) Car payment of $260 a month for 60 months View hint for Question 3 Question 4 (0.2 points) Which of the following will increase the present value of an annuity, all else held constant? I. Increase in the number of payments II. Decrease in the interest rate III. Increase in the interest rate IV. Decrease in the payment amount 1) II and IV only 2) I, II, and IV only 3) I and III only 4) I and II only 5) I, III, and IV only D View hint for Question 4 Question 5 ( 0.2 points) Jenny just won a scholarship that will pay her $500 a month, starting the end of this month, and continuing for the next 48 months. Which one of the following terms best describes these scholarship payments? 1) Consol 2) Ordinary perpetuity 3) Ordinary annuity 4) Perpetuity due 5) Annuity due DView hint for Question 5 Question 6 (0.2 points) Which one of the following is an ordinary annuity? 1) $75 paid at the beginning of each monthly period for 50 years 2) $40 paid quarterly for 5 years, starting today 3) \$15 paid at the end of each monthly period for an infinite period of time 4) \$25 paid every year for ten years, starting today 5) $50 paid weekly for 1 year, starting one week from today Question 7(0.2 points) You set up a college fund in which you deposit $3000 each year at the end of the year. How much money will you have accumulated in the fund after 8 years, if your fund earns 12% compounded annually? Your Answer: Answer Question 8 (0.2 points) You are comparing three investments, all of which pay $100 a month and have an 8 percent interest rate. One is ordinary annuity, one is an annuity due, and the third investment is a perpetuity. Which one of the following statements is correct given these three investment options? 1) The ordinary annuity would be more valuable than the annuity due if both had a life of 10 years. 2) The future value of all three investments must be equal. 3) The present value of all three investments must be equal. 4) To be the perpetuity, the payments must occur on the first day of each monthly period. 5) The present value of the perpetuity has to be higher than the present value of either the ordinary annuity or the annuity due. D View hint for Question 8 Question 9 (0.2 points) The stated interest rate is the interest rate: 1) as if it were compounded daily. 2) that ignores compounding. 3) in terms of an effective rate. 4) as the quoted rate compounded by 12 periods per year. 5) in terms of the rate charged per day. D View hint for Question 9 Question 10 (0.2 points) Anna is buying a new car today and is paying a $500 cash down payment. She will finance the balance at 7.25 percent interest. Her loan requires 36 equal monthly payments of $450 each with the first payment due 30 days from today. Which one of the following statements is correct concerning this purchase? 1) The car loan is an annuity due. 2) The $500 is the present value of the purchase. 3) The present value of the car is equal to $500+(36$450). 4) The future value of the loan is equal to 36$450. 5) To compute the initial loan amount, you must use a monthly interest rate. D View hint for Question 10 Question 11 ( 0.2 points) Lauren knows she can afford to make monthly payments of $325 for 48 months. How much will the bank lend her today on a 3% APR car loan in exchange for her promised monthly payments? Your Answer: Answer Question 12 (0.2 points) Mary's 25th birthday is today, and she hopes to retire on her 65 th birthday. She has determined that she will need to have $5,000,000 in her retirement savings account in order to live comfortably. Mary currently has no retirement savings, and her investments will earn 7% annually. How much must she deposit into her account at the end of each of the next 40 years to meet her retirement savings goal? Your Answer: Answer Question 13 (0.2 points) Your bank offers you a 60-month, 3\% APR car loan for a $60000 new Mercedes SLK300 Roadster. What will your monthly payment be? Your Answer: Answer Question 14 (0.2 points) Jeff just financed a used car through his credit union. His loan requires payments of $275 a month for five years. Assuming that all payments are paid on time, his last payment will pay off the loan in full. What type of loan does Bill have? 1) Amortized 2) Pure discount 3) Complex 4) Interest-only 5) Lump sum DView hint for Question 14 Question 15 (0.2 points) The remaining balance on an amortized loan is paid down evenly over the life of the loan. For example, if you borrow $20,000 today on a 60 -month amortized loan then your remaining balance reduces by 20,000/60=$333.33 each month. True False Which of the following is a valid criticism concerning the goal of firms to maximize profits? Profit maximization ignores expenses. There are no valid criticisms of profit maximization as a goal. Profit maximization is completely unrelated to shareholder wealth. Profitable firms may not be generating free cash flow. Question 2 (0.2 points) A takeover is an attempt to seize control of a corporation by purchasing the majority of its outstanding stock. True False Question 3 (0.2 points) Which one of the following is an example of a perpetuity? 1) Retirement pay of $2,200 a month for 20 years 2) Lottery winnings of $1,000 a month for life 3) Apartment rent payment of $800 a month for one year 4) Trust income of $1,200 a year forever 5) Car payment of $260 a month for 60 months View hint for Question 3 Question 4 (0.2 points) Which of the following will increase the present value of an annuity, all else held constant? I. Increase in the number of payments II. Decrease in the interest rate III. Increase in the interest rate IV. Decrease in the payment amount 1) II and IV only 2) I, II, and IV only 3) I and III only 4) I and II only 5) I, III, and IV only D View hint for Question 4 Question 5 ( 0.2 points) Jenny just won a scholarship that will pay her $500 a month, starting the end of this month, and continuing for the next 48 months. Which one of the following terms best describes these scholarship payments? 1) Consol 2) Ordinary perpetuity 3) Ordinary annuity 4) Perpetuity due 5) Annuity due DView hint for Question 5 Question 6 (0.2 points) Which one of the following is an ordinary annuity? 1) $75 paid at the beginning of each monthly period for 50 years 2) $40 paid quarterly for 5 years, starting today 3) \$15 paid at the end of each monthly period for an infinite period of time 4) \$25 paid every year for ten years, starting today 5) $50 paid weekly for 1 year, starting one week from today Question 7(0.2 points) You set up a college fund in which you deposit $3000 each year at the end of the year. How much money will you have accumulated in the fund after 8 years, if your fund earns 12% compounded annually? Your Answer: Answer Question 8 (0.2 points) You are comparing three investments, all of which pay $100 a month and have an 8 percent interest rate. One is ordinary annuity, one is an annuity due, and the third investment is a perpetuity. Which one of the following statements is correct given these three investment options? 1) The ordinary annuity would be more valuable than the annuity due if both had a life of 10 years. 2) The future value of all three investments must be equal. 3) The present value of all three investments must be equal. 4) To be the perpetuity, the payments must occur on the first day of each monthly period. 5) The present value of the perpetuity has to be higher than the present value of either the ordinary annuity or the annuity due. D View hint for Question 8 Question 9 (0.2 points) The stated interest rate is the interest rate: 1) as if it were compounded daily. 2) that ignores compounding. 3) in terms of an effective rate. 4) as the quoted rate compounded by 12 periods per year. 5) in terms of the rate charged per day. D View hint for Question 9 Question 10 (0.2 points) Anna is buying a new car today and is paying a $500 cash down payment. She will finance the balance at 7.25 percent interest. Her loan requires 36 equal monthly payments of $450 each with the first payment due 30 days from today. Which one of the following statements is correct concerning this purchase? 1) The car loan is an annuity due. 2) The $500 is the present value of the purchase. 3) The present value of the car is equal to $500+(36$450). 4) The future value of the loan is equal to 36$450. 5) To compute the initial loan amount, you must use a monthly interest rate. D View hint for Question 10 Question 11 ( 0.2 points) Lauren knows she can afford to make monthly payments of $325 for 48 months. How much will the bank lend her today on a 3% APR car loan in exchange for her promised monthly payments? Your Answer: Answer Question 12 (0.2 points) Mary's 25th birthday is today, and she hopes to retire on her 65 th birthday. She has determined that she will need to have $5,000,000 in her retirement savings account in order to live comfortably. Mary currently has no retirement savings, and her investments will earn 7% annually. How much must she deposit into her account at the end of each of the next 40 years to meet her retirement savings goal? Your Answer: Answer Question 13 (0.2 points) Your bank offers you a 60-month, 3\% APR car loan for a $60000 new Mercedes SLK300 Roadster. What will your monthly payment be? Your Answer: Answer Question 14 (0.2 points) Jeff just financed a used car through his credit union. His loan requires payments of $275 a month for five years. Assuming that all payments are paid on time, his last payment will pay off the loan in full. What type of loan does Bill have? 1) Amortized 2) Pure discount 3) Complex 4) Interest-only 5) Lump sum DView hint for Question 14 Question 15 (0.2 points) The remaining balance on an amortized loan is paid down evenly over the life of the loan. For example, if you borrow $20,000 today on a 60 -month amortized loan then your remaining balance reduces by 20,000/60=$333.33 each month. True FalseStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started