Question 16

If you take the sum of all taxes paid, and divide that sum by the total taxable income, this equals:

(a) the average tax rate;

(b) the variable tax rate;

(c) the marginal tax rate;

(d) the absolute tax rate; or

(e) the contingent tax rate.

Question 17

The __________ is the rate of tax that determines the amount of tax that will be due on the next dollar of taxable income earned.

(a) average tax rate;

(b) variable tax rate;

(c) marginal tax rate;

(d) fixed tax rate; or

(e) the Lois Lerner tax rate.

Question 18

Cash flow from assets is defined as:

(a) the cash flow(s) to shareholders, minus the cash flow(s) to creditors;

(b) operating cash flow(s), plus the cash flow(s) to creditors, plus the cash flow(s) to shareholders;

(c) operating cash flow(s), minus the change in net working capital, minus net capital spending;

(d) operating cash flow(s), plus net capital spending, plus the change in net working capital; or

(e) cash flow(s) to shareholders, minus net capital spending, plus the change in net working capital.

Question 19

Operating cash flow(s) is best defined as:

(a) a firm's net profit over a specified period of time;

(b) the cash that a firm generates from its normal business activities;

(c) a firm's operating margin;

(d) the change in the net working capital over a stated period of time; or

(e) the cash that is generated and added to retained earnings.

Question 20

Over the last fiscal year, Casalis Corndog-Flavored Lip Balm, LLC has decreased its current assets while increasing its current liabilities. Consequently, this companys net working capital:

(a) has had to go up;

(b) has had to go down;

(c) has remained constant;

(d) could have gone up or down, or remained constant; or

(e) not enough information has been provided.