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FIN 370 Assignment Week 1 Apply Exercise
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FIN 370 Week 1 Apply Exercise
Review the Week 1 “Knowledge Check” in Connect® in preparation
for this assignment.
Complete the Week 1 “Exercise” in Connect®.
Note: You have only one attempt available to complete this
assignment. Grades must be transferred manually to eCampus by your
instructor. Don’t worry, this might happen after your due date.
Materials
 Learn: McGraw-Hill Connect® Access
Maximizing owners’ equity value means carefully considering all of
the following EXCEPT
Multiple Choice
how best to return the profits from those projects to the owners over
time.
which projects to invest in.
how to best bring additional funds into the firm.
how best to increase the firm’s risk.
Not all cash a company generates will be returned to the investors.
Which of the following will NOT reduce the amount of capital
returned to the investors?
Multiple Choice
taxes
dividends
retained earnings

As individual legal entities, corporations assume liability for their
own debts, so the shareholders hold
Multiple Choice unlimited liability.
shared liability.
joint liability.
only limited liability.
For corporations, maximizing the value of owner’s equity can also be
stated as
Multiple Choice
maximizing the stock price.
maximizing earnings per share.
maximizing retained earnings.
maximizing net income.
Which of the following is not an impact of the slowdown occurring in
China’s economy?
Multiple Choice
falling community prices
lower demand in materials such as steel, iron ore, and copper
real estate market declining in Sydney, Australia
money going out of Manhattan, New York
What is the debt ratio for a firm with an equity multiplier of 3.5?
Multiple Choice
58.51 percent
66.25 percent
44.09 percent
71.43 percent
Which of the following refer to ratios that measure the relationship
between a firm’s liquid (or current) assets and its current liabilities?
Multiple Choice
internal-growth
market value
liquidity
cross-section
For publicly traded firms, which of these ratios measure what
investors think of the company’s future performance and risk?
Multiple Choice
profitability ratios

liquidity ratios
price value ratios
market value ratios
Which of the following is the maximum growth rate that can be
achieved by financing asset growth with new debt and retained
earnings?
Multiple Choice
sustainable growth rate
weighted growth rate
internal growth rate
retained earnings growth rate
To interpret financial ratios, managers, analysts, and investors use
which of the following type of benchmarks?
Multiple Choice time series analysis time-industry analysis
competitive analysis
cross-industry analysis
n both the original deposit and on the earlier interest payments
Multiple Choice
discounting.
computing.
multiplying.
compounding.
MC Qu. 4-71 A deposit of $500 earns 5…
A deposit of $500 earns 5 percent the first year, 6 percent the second
year, and 7 percent the third year. What would be the third year future
value?
Multiple Choice
$595.46
$634.91
$671.02
$615.62
MC Qu. 4-9 With regard to money deposited in…
With regard to money deposited in a bank, future values are
Multiple Choice
smaller than present values.
are completely independent of present values.

equal to present values.
larger than present values.
MC Qu. 4-17 What is the future value of…
What is the future value of $2,000 deposited for one year earning 6
percent interest rate annually?
Multiple Choice
$4,120
$2.000
$120
$2,120
MC Qu. 4-10 A dollar paid (or received) in…
A dollar paid (or received) in the future is
Multiple Choice
not comparable to a dollar paid (or received) today.
worth as much as a dollar paid (or received) today.
worth more than a dollar paid (or received) today.
not worth as much as a dollar paid (or received) today.
MC Qu. 4-29 Approximately how many years does it…
Approximately how many years does it take to double a $300
investment when interest rates are 8 percent per year?
Multiple Choice
9 years
11 years
4.17 years
0.11 years
MC Qu. 4-7 The interest rate, i, which we…
The interest rate, i, which we use to calculate present value, is often
referred to as the
Multiple Choice
compound rate.
dividend.
multiplier.
discount rate.
MC Qu. 4-73 What is the present value of…
What is the present value of a $600 payment in one year when the
discount rate is 8 percent?
Multiple Choice

$525.87
$575.09
$555.56
$498.61
MC Qu. 4-78 Approximately what rate is needed to…
Approximately what rate is needed to double an investment over five
years?
Multiple Choice
12.2 percent
8 percent
15.8 percent
14.4 percent
MC Qu. 4-79 Determine the interest rate earned on…
Determine the interest rate earned on an $800 deposit when $808 is
paid back in one year.
Multiple Choice
100 percent
15 percent
10 percent
1 percent
MC Qu. 4-109 You double your money in 5…
You double your money in five years. The reason your return is not
20 percent per year is because:
Multiple Choice
it is probably a “fad” investment.
it does not reflect the effect of the Rule of 72.
it does not reflect the effect of compounding.
it does not reflect the effect of discounting.
MC Qu. 5-146 Which of the following will increase…
Which of the following will increase the future value of an annuity?
Multiple Choice
The number of periods increases.
The amount of the annuity increases.
The interest rate increases.
All of these choices are .

What is the future value of a $1,000 annuity payment over 4 years if
the interest rates are 8 percent?
Multiple Choice
$4,506.11
$9,214.20
$4,320.00
$3,312.10
MC Qu. 5-74 If the present value of an…
If the present value of an ordinary, 8-year annuity is $12,500 and
interest rates are 9.1 percent, what is the present value of the same
annuity due?
Multiple Choice
$14,114.80
$14,211.90
$13,941.90
$13,637.50
Which of the following will increase the present value of an annuity?
Multiple Choice
The effective rate is calculated over fewer years.
The amortization schedule decreases.
The interest rate decreases.
The number of periods decreases.
MC Qu. 5-30 If the future value of an…
If the future value of an ordinary, 7-year annuity is $10,000 and
interest rates are 4 percent, what is the future value of the same
annuity due?
Multiple Choice
$10,700.00
$10,000.00
$10,400.00
$9,615.38
annuity due?
Multiple Choice

$943.40
$1,000.00
$1,040.00
$1,060.00
MC Qu. 5-33 A loan is offered with monthly…
A loan is offered with monthly payments and a 6.5 percent APR.
What is the loan’s effective annual rate (EAR)?
Multiple Choice
5.69 percent
12.63 percent
7.28 percent
6.697 percent
MC Qu. 5-15 People refinance their home…
People refinance their home mortgages
Multiple Choice
when rates fall and rise.
whenever they need to, independent of rates.
when rates fall.
when rates rise.
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FIN 370 Assignment Week 1 Practice
Knowledge Check
FIN 370 Week 1 Practice Knowledge Check

Complete the Week 1 “Knowledge Check” in Connect®.
Note: You have unlimited attempts available to complete this practice
assignment. The highest scored attempt will be recorded. These
assignments have earlier due dates, so plan accordingly. Grades must
be transferred manually to eCampus by your instructor. Don’t worry,
this might happen after your due date.
MC Qu. 1-14 Which of the following managers would…
Which of the following managers would NOT use finance?
Multiple Choice human resource managers marketing managers
operational managers
all of these choices are .
MC Qu. 1-11 Which of the following is defined…
Which of the following is defined as a group of securities that exhibit
similar characteristics, behave similarly in the marketplace, and are
subject to the same laws and regulations?
Multiple Choice
market instruments
investments
financial markets
asset classes
MC Qu. 1-63 An angel investor differs from a…
An angel investor differs from a venture capitalist because of the
Multiple Choice size of investment.
voting rights.
type of investment.
investment time frame.
MC Qu. 1-18 This type of business organization is…
This type of business organization is entirely legally independent
from its owners.
Multiple Choice hybrid organizations partnership sole proprietorship
public corporations
MC Qu. 1-67 Which of these is the system…
Which of these is the system of incentives and monitors that tries to
overcome the agency problem?
Multiple Choice checks and Balances Security Exchange Commission
board of Directors
corporate Governance

MC Qu. 1-54 From the perspective of control, the…
From the perspective of control, the best form of business
organization is the
Multiple Choice corporation.
partnership.
S corporation.
sole proprietorship.
MC Qu. 1-19 Which of the following is…
Which of the following is NOT considered a hybrid organization?
Multiple Choice
limited liability partnership
limited liability company
limited partnership
S corporation
MC Qu. 1-1 The increase in oil production in…
The increase in oil production in the United States characterizes
which of the following key financial concepts presented in this book?
Multiple Choice the Rule of 72 time value of money capital budgeting
risk and return
MC Qu. 1-59 All of the following are an…
All of the following are an example of a fiduciary relationship
EXCEPT
Multiple Choice a financial advisor advises her clients.
a CEO manages the firm.
the shareholder elects a board member.
a bank employee manages deposits.
MC Qu. 3-85 Which ratio assesses how efficiently a…
Which ratio assesses how efficiently a firm uses its fixed assets?
Multiple Choice
capital intensity ratio
current ratio
fixed asset turnover
average collection period
MC Qu. 3-90 A firm reported working capital of…

A firm reported working capital of $5.5 million and fixed assets of
$20 million. Its fixed asset turnover was 1.2 times. What was the
firm’s sales to working capital ratio?
Multiple Choice 4.36 times
6.03times 2.21 times 5.19 times
MC Qu. 3-103 Which ratio measures the number of…
Which ratio measures the number of dollars of operating cash
available to meet each dollar of interest and other fixed charges that
the firm owes?
Multiple Choice fixed-charge coverage ratio cash coverage ratio
operating coverage ratio
times interest earned
MC Qu. 3-25 You are evaluating the balance sheet…
You are evaluating the balance sheet for Blue Jays Corporation. From
the balance sheet you find the following balances: cash and
marketable securities = $200,000, accounts receivable = $800,000,
inventory = $1,000,000,accrued wages and taxes = $250,000,
accounts payable = $400,000, and notes payable = $300,000. What
are Blue Jays’ current ratio, quick ratio, and cash ratio, respectively?
Multiple Choice
3.07692, 1.53846, 0.30769
1.05263, 1.05263, 0.21053
2.10526, 1.05263, 0.21053
3.07692, 1.05263, 0.30769
MC Qu. 3-6 Which of the following ratios measure…
Which of the following ratios measure how efficiently a firm uses its
assets, as well as how efficiently the firm manages its accounts
payable?
Multiple Choice
quick or acid-test
cash
internal-growth
asset management
MC Qu. 3-20 For publicly traded firms, which of…
Multiple Choice

profitability ratios
liquidity ratios
price value ratios
market value ratios
MC Qu. 3-116 Which ratio measures the overall return…
Which ratio measures the overall return on the firm’s assets including
financial leverage and taxes?
Multiple Choice
basic earning power
ROE
ROA
profit margin
MC Qu. 3-112 The maximum growth rate that can…
The maximum growth rate that can be achieved by financing asset
growth with internal financing or retained earnings is called the
Multiple Choice
internal growth rate.
sustainable growth rate.
retention rate.
operating expansion rate.
MC Qu. 3-22 Which of the following is the…
earnings?
Multiple Choice weighted growth rate internal growth rate sustainable
growth rate
retained earnings growth rate
MC Qu. 3-23 To interpret financial ratios, managers, analysts,…
Multiple Choice
time series analysis
cross-industry analysis
time-industry analysis
MC Qu. 3-42 Last year Poncho Villa Corporation had…

Last year Poncho Villa Corporation had an ROA of 16 percent and a
dividend payout ratio of 25 percent. What is the internal growth rate?
Multiple Choice
13.64 percent
33.33 percent
25.40 percent
1.19 percent
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Knowledge Check
FIN 370 Week 2 Practice Knowledge Check
Materials
 Learn: McGraw-Hill Connect® Access
Multiple Choice

$1,005
$1,000
$2,050
$1,050
MC Qu. 4-5 We call the process of earning…
We call the process of earning interest on both the original deposit
and on the earlier interest payments
Multiple Choice
discounting.
computing.
multiplying.
compounding.
MC Qu. 4-71 A deposit of $500 earns 5…
value?
Multiple Choice
$595.46
$634.91
$671.02
$615.62
MC Qu. 4-9 With regard to money deposited in…
Multiple Choice
smaller than present values.
equal to present values.
larger than present values.
Multiple Choice
$4,120
$2.000
$120
$2,120
MC Qu. 4-10 A dollar paid (or received) in…

Multiple Choice
MC Qu. 4-29 Approximately how many years does it…
Multiple Choice
9 years
11 years
4.17 years
0.11 years
MC Qu. 4-7 The interest rate, i, which we…
The interest rate, i, which we use to calculate present value, is often
referred to as the
Multiple Choice
compound rate.
dividend.
multiplier.
discount rate.
MC Qu. 4-73 What is the present value of…
Multiple Choice
$525.87
$575.09
$555.56
$498.61
MC Qu. 4-78 Approximately what rate is needed to…
years?
Multiple Choice
12.2 percent
8 percent
15.8 percent

14.4 percent
MC Qu. 4-79 Determine the interest rate earned on…
Determine the interest rate earned on an $800 deposit when $808 is
Multiple Choice
100 percent
15 percent
10 percent
1 percent
MC Qu. 4-109 You double your money in 5…
Multiple Choice
it is probably a “fad” investment.
it does not reflect the effect of the Rule of 72.
it does not reflect the effect of compounding.
it does not reflect the effect of discounting.
Which of the following will increase the future value of an annuity?
Multiple Choice
The number of periods increases.
The amount of the annuity increases.
The interest rate increases.
All of these choices are .
What is the future value of a $1,000 annuity payment over 4 years if
Multiple Choice
$4,506.11
$9,214.20
$4,320.00
$3,312.10
MC Qu. 5-74 If the present value of an…
interest rates are 9.1 percent, what is the present value of the same
annuity due?
Multiple Choice

$14,114.80
$14,211.90
$13,941.90
$13,637.50
Which of the following will increase the present value of an annuity?
Multiple Choice
The effective rate is calculated over fewer years.
The amortization schedule decreases.
The interest rate decreases.
The number of periods decreases.
annuity due?
Multiple Choice
$10,700.00
$10,000.00
$10,400.00
$9,615.38
annuity due?
Multiple Choice
$943.40
$1,000.00
$1,040.00
$1,060.00
MC Qu. 5-33 A loan is offered with monthly…
A loan is offered with monthly payments and a 6.5 percent APR.
What is the loan’s effective annual rate (EAR)?
Multiple Choice
5.69 percent
12.63 percent
7.28 percent
6.697 percent

MC Qu. 5-15 People refinance their home…
People refinance their home mortgages
Multiple Choice
when rates fall and rise.
whenever they need to, independent of rates.
when rates fall. when rates rise.
*******************************************************
Knowledge Check
FIN 370 Assignment Week 3 PracticeKnowledge Check
MC Qu. 7-67 Which of the following is NOT…
Which of the following is NOT true about EE savings bonds?
Multiple Choice

These are tax deferred investments.
Interest payments are received annually but are tax deductible.
About one in six Americans owns a savings bond.
Paper bonds sell for one-half of their face value.
MC Qu. 7-4 Which of the following is a legal…
Which of the following is a legal contract that outlines the precise
terms between the issuer and the bondholder?
Multiple Choice
Prospectus
Enforcement codes
Debenture
Indenture

MC Qu. 7-125 A 4.15 percent TIPS has an…
A 4.15 percent TIPS has an original reference CPI of 182.1. If the
current CPI is 188.3, what is the par value of the TIPS?
Multiple Choice
$1,000.00
$1,004.75
$967.07
$1,034.05
current CPI is 205.1, what is the current interest payment and par
value of the TIPS? (Assume semi-annual interest payments and
$1,000 par value.)
Multiple Choice
$878.60, $16.79, respectively

$1,000.00, $29.50, respectively
$1,138.18, $29.50, respectively
$1,138.18, $16.79, respectively
current CPI is 188.3, what is the par value of the TIPS?
Multiple Choice
$992.75
$981.75
$1,018.60
$1,042.95
MC Qu. 7-38 Calculate the price of a zero…

Calculate the price of a zero coupon bond that matures in 10 years if
the market interest rate is 6 percent. (Assume semi-annual
compounding and $1,000 par value.)
Multiple Choice
$1,000.00
$553.68
$558.66
$940.00
MC Qu. 7-18 Which of the following terms means…
Which of the following terms means the chance that future interest
payments will have to be reinvested at a lower interest rate?
Multiple Choice
Credit quality risk
Interest rate risk
Reinvestment rate risk

Liquidity rate risk
MC Qu. 7-43 What’s the taxable equivalent yield on a municipal…
What’s the taxable equivalent yield on a municipal bond with a yield
to maturity of 3.9 percent for an investor in the 35 percent marginal
tax bracket?
Multiple Choice
1.09%
6.00%
11.14%
3.90%
MC Qu. 7-21 Which of the following is an…
Which of the following is an important advantage to the issuer of a
bond with a call provision?

Multiple Choice
They allow for refinancing opportunities.
They are able to avoid reinvestment rate risk.
They are able to avoid interest rate risk.
They are able to reduce their credit risk.
Which of the following are backed only by the reputation and
financial stability of the corporation?
Multiple Choice
Both debentures and unsecured bonds
Debentures
None of the options
Unsecured bonds

Which of the following terms is the chance that the bond issuer will
not be able to make timely payments?
Multiple Choice
Interest rate risk
Liquidity of interest rate risk
Term structure of interest rates
Credit quality risk
As residual claimants, which of these investors claim any cash flows
to the firm that remain after the firm pays all other claims?
rev: 07_10_2017_QC_CS-93259
Multiple Choice
preferred stockholders
creditors

common stockholders
bondholders
All of the following are stock market indices EXCEPT:
Multiple Choice
Dow Jones Industrial Average.
Standard & Poor’s 500 Index.
Nasdaq Composite Index.
Mercantile 1000.
You would like to sell 400 shares of International Business Machines
(IBM). The current bid and ask quotes are $96.24 and $96.17,

respectively. You place a limit sell-order at $96.20. If the trade
executes, how much money do you receive from the buyer?
Multiple Choice
$38,464.00
$38,496.00
$38,468.00
$38,480.00
Investors sell stock at the:
Multiple Choice
dealer price.
broker price.
bid price.
quoted ask price.

At your discount brokerage firm, it costs $9.95 per stock trade. How
much money do you need to buy 100 shares of Ralph Lauren (RL),
which trades at $85.13?
Multiple Choice
$8,503.05
$8,503.00
$9,508.00
$8,522.95
A preferred stock from DLC pays $5.10 in annualdividends. If the
required return on the preferred stock is 12.1 percent, what is the
value of the stock?
Multiple Choice
$42.15
$47.25

$240.97
$6.31
At your discount brokerage firm, it costs $10.50 per stock trade. How
much money do you need to buy 100 shares of Apple (AAPL), which
trades at $202.64?
Multiple Choice
$21,314.00
$20,274.50
$20,253.50
In
$20,264.00

JPM has earnings per share of $3.75 and P/E of 47. What is the stock
price?
Multiple Choice
$185.95
$174.08
$112.98
$176.25
Pfizer, Inc. (PFE) has earnings per share of $2.09 and a P/E ratio of
11.02. What is the stock price?
Multiple Choice
$18.97
$5.27
$23.03
$0.19

*******************************************************
FIN 370 Cash Flow Problem Sets (4-5,4-7,4-
8,4-11,4-13)
4-5 Multiyear Future Value How much would be in your savings
account in 11 years after depositing $150 today if the bank pays 8
percent per year? (LG4-3)
4-7 Compounding with Different Interest Rates A deposit of $350
earns the following interest rates:
a. 8 percent in the first year.
b. 6 percent in the second year.
c. 5.5 percent in the third year.
What would be the third year future value?
4-8 Compounding with Different Interest Rates A deposit of $750
earns interest rates of 9 percent in the first year and 12 percent in the
second year. What would be the second year future value? (LG4-3)
4-11 Present Value What is the present value of a $1,500 payment
made in nine years when the discount rate is 8 percent? (LG4-4)

4-13 Present Value with Different Discount Rates Compute the
present value of $1,000 paid in three years using the following
discount rates: 6 percent in the first year, 7 percent in the second
year, and 8 percent in the third year. (LG4-4)
*******************************************************
FIN 370 Entire Course New Syllabus,with Final
Guide
FIN 370 Final Exam Guide (New 2017)
FIN 370 Week 1 Question and Problem Sets (Ch 1: Q 3,11 Ch 2:
Q4,9, CH 3: Q4,7, Ch 4: Q 1,6)
FIN 370 Week 2 Question and Problem Sets (Ch 5: Q3,Q4 Ch 6: Q2,
Q20, Ch 7 : Q3,Q11 Ch 8: Q1,Q6)
FIN 370 Week 3 Question and Problem Sets (Ch 9: Q7 & Q8, Ch 10:
Q3& Q13, Ch 11: Q 1 & Q7)

FIN 370 Week 3 Assignment Financial Ratio analysis
FIN 370 Week 4 Team Weighted Average Cost of Capital
FIN 370 Week 4 Individual WACC and Corporate Investment
Decisions
FIN 370 Week 5 Question and Problem Set (Ch18-Q3, Ch18-Q11,
Ch20-Q8, Ch20-Q14, Ch21-Q4, Ch21-Q7, Ch26-Q1, Ch26-Q2)
*******************************************************
FIN 370 Final Exam Guide (New)
Which financial statement reports the amounts of cash that the firm
generated and distributed during a particular time period?
statement of retained earnings
Income statement
Statement of cash flows
Balance sheet

Which of these provide a forum in which demanders of funds raise
funds by issuing new financial instruments, such as stocks and bonds?
Money markets
Investment banks
Primary markets
Secondary markets
The top part of Mars, Inc.’s 2013 balance sheet is listed as follows (in
millions of dollars).
What are Mars, Inc.’s current ratio, quick ratio, and cash ratio for
2013?
4.2, 1.0, 0.2
2.3333, 0.5556, 0.1111
10.5, 6.0, 1.0
0.1111, 0.5556, 0.2
Which of these ratios show the combined effects of liquidity, asset
management, and debt management on the overall operation results
of the firm?
Financial
Profitability

Coverage
Liquidity
As new capital budgeting projects arise, we must
estimate__________.
the cost of the stock being sold for the specific project
when such projects will require cash flows
the cost of the loan for the specific project
the float costs for financing the project
What’s the current yield of a 6 percent coupon corporate bond quoted
at a price of 101.70?
6.1 percent
10.2 percent
6.0 percent
5.9 percent
and on the earlier interest payments:
computing.
multiplying.
compounding.
discounting.

Which financial statement reports a firm’s assets, liabilities, and
equity at a particular point in time?
Balance sheet
Income statement
Statement of retained earnings
You are trying to pick the least-expensive machine for your company.
You have two choices: machine A, which will cost $50,000 to
purchase and which will have OCF of -$3,500 annually throughout
the machine’s expected life of three years; and machine B, which will
cost $75,000 to purchase and which will have OCF of -$4,900
annually throughoutthat machine’s four-year life. Both machines will
be worthless at the end of their life. If you intend to replace whichever
type of machine you choose with the same thing when its life runs out,
again and again out into the foreseeable future, and if your business
has a cost of capital of 14 percent, which one should you choose?
Machine A
Machine B
Neither machine A nor B
Both machines A and B
When firms use multiple sources of capital, they need to calculate the
appropriate discount rate for valuing their firm’s cash flows
as__________.
a simple average of the capital components costs
a weighted average of the capital components costs
a sum of the capital components costs

they apply to each asset as they are purchased with their respective
forms of debt or equity
Which of these is used as a measure of the total amount of available
cash flow from a project?
Operating cash flow
Investment in operating capital
Free cash flow
Sunk cash flow
Which of these does NOT perform vital functions to securities markets
of all sorts by channeling funds from those with surplus funds to those
with shortages of funds?
Secondary markets
Mutual funds
Insurance companies
Commercial banks
Will’s Wheels, Inc. reported a debt-to-equity ratio of 0.65 times at the
end of 2013. If the firm’s total debt at year-end was $5 million, how
much equity does Will’s Wheels have?
$7.69 million
$5 million
$0.65 million
$3.25 million

Which of these is the term for portfolios with the highest return
possible for each risk level?
Total portfolios
Modern portfolios
Optimal portfolios
Efficient portfolios
What are the tools available for the manager in financial planning?
Delaying disbursement of cash, reducing collection period, cash
management, and Increasing inventory turnover
Reducing collection period and delaying disbursement of cash
Increasing inventory turnover and reducing collection period
Delaying disbursement of cash and cash management
Suppose that Model Nails, Inc.’s capital structure features 60 percent
equity, 40 percent debt, and that its before-tax cost of debt is 6
percent, while its cost of equity is 10 percent. If the appropriate
weighted average tax rate is 28 percent, what will be Model Nails’
WACC?
7.73 percent

8.40 percent
8.00 percent
16.00 percent
We commonly measure the risk-return relationship using which of the
following?
Coefficient of variation
Standard deviation
Expected returns
Correlation coefficient
Financial plans include which of the following?
Schedule of Sales, Expenses, and Capital Expenditure
All of the above
Short Term and Long Term Plan
Pro forma Income Statement, Balance Sheet
Which of the following terms means that during periods when interest
rates change substantially, bondholders experience distinct gains and
losses in their bond investments?

Interest rate risk
Credit quality risk
Reinvestment rate risk
Liquidity rate risk
What are reasons for the firm to go abroad?
Access to raw materials
Diversification
Lower production cost
All of the above
Which of these statements is true regarding divisional WACC?
Using a simple firmwide WACC to evaluate new projects would give
an unfair advantage to projects that present more risk than the firm’s
average beta.
Using a divisional WACC versus a WACC for the firm’s current
operations will result in quite a few incorrect decisions.
Using a firmwide WACC to evaluate new projects would have no
impact on projects that present less risk than the firm’s average beta.
Using a simple firmwide WACC to evaluate new projects would give
an unfair advantage to projects that present less risk than the firm’s
average beta.

The Rule of 72 is a simple mathematical approximation
for__________. the number of years required to double an investment
the payments required to double an investment
the present value required to double an investment
the number of years required to double an investment
the future value required to double an investment
We can estimate a stock’s value by__________.
using the book value of the total stockholder equity section
using the book value of the total assets divided by the number of
shares outstanding
discounting the future dividends and future stock price appreciation
compounding the past dividends and past stock price appreciation
Which of these is the process of estimating expected future cash flows
of a project using only the relevant parts of the balance sheet and
income statements?
Substitutionary analysis
Incremental cash flows
Cash flow analysis
Pro forma analysis

Five years ago, Jane invested $5,000 and locked in an 8 percent
annual interest rate for 25 years (ending 20 years from now). James
can make a 20-year investment today and lock in a 10 percent interest
rate. How much money should he invest now in order to have the
same amount of money in 20 years as Jane?
$7,346.64
$5,089.91
$3,160.43
$3,464.11
The overall goal of the financial manager is to__________.
maximize net income
maximize earnings per share
maximize shareholder wealth
minimize total costs
Which of the following can create ethical dilemmas between
corporate managers and stockholders?
Auditors
Board of directors

Agency relationship
Venture Capitalist
A firm is expected to pay a dividend of $2.00 next year and $2.14 the
following year. Financial analysts believe the stock will be at their
target price of $75.00 in two years. Compute the value of this stock
with a required return of 10 percent.
$79.14
$65.40
$65.57
$66.67
Which financial statement shows the total revenues that a firm earns
and the total expenses the firm incurs to generate those revenues over
a specific period of time — generally one year?
Statement of retained earnings
Balance sheet
Income statement
Which of the following is a true statement?
If interest rates fall, all bonds will enjoy rising values.
If interest rates fall, corporate bonds will have decreasing values.
If interest rates fall, no bonds will enjoy rising values.

If interest rates fall, U.S. Treasury bonds will have decreasing values.
*******************************************************
FIN 370 Final Exam Guide (New, 100% score)
Which one of the following statements is correct concerning the cash
cycle?
Accepting a supplier’s discount for early payment decreases the cash
cycle.
Increasing the accounts payable period increases the cash cycle.
The longer the cash cycle, the more likely a firm will need external
financing.
The cash cycle can exceed the operating cycle if the payables period
is equal to zero.
Offering early payment discounts to customers will tend to increase
the cash cycle.
Precise Machinery is analyzing a proposed project. The company
expects to sell 2100 units give or take 5 percent. The expected
variable cost per unit is $260 and the expected fixed costs are
$589,000. Cost estimates are considered accurate within a plus or
minus 4 percent range. The depreciation expense is $129,000. The
sales price is estimated at $750 per unit, give or take 2 percent. The

tax rate is 35 percent. The company is conducting a sensitivity
analysis on the sales price using a sales price estimate of $755. What
is the operating cash flow based on this analysis?
$86,675
$354,874
$368,015
$293,089
$337,975
You are doing some comparison shopping. Five stores offer the
product you want at basically the same price but with differing credit
terms. Which one of these terms is best-suited to you if you plan to
forgo the discount?
2/10, net 30
2/5, net 30
2/5, net 20
1/10, net 45
1/5, net 15
The plowback ratio is:
The dollar increase in net income divided by the dollar increase in
sales.
Equal to net income divided by the change in total equity.
Equal to one minus the retention ratio.
The change in retained earnings divided by the dividends paid.

The percentage of net income available to the firm to fund future
growth.
Which one of the following is the financial statement that summarizes
a firm’s revenue and expenses over a period of time?
Market value report
Tax reconciliation statement
Balance sheet
Income statement
Kelly’s Corner Bakery purchased a lot in Oil City six years ago at a
cost of $278000.Today, that lot has a market value of $264,000.At
the time of the purchase, the company spent $6,000 to level the lot
and another $8,000 to install storm drains. The company now wants
to build a new facility on that site. The building cost is estimated at
$1.03 million. What amount should be used as the initial cash flow for
this project?
-$1,294,000
-$1,322,000
-$1,045,000
-$1,308,000
-$1,308,000
Webster United is paying a dividend of $1.32 per share today. There
are 350,000 shares outstanding with a market price of $22.40 per
share prior to the dividend payment. Ignore taxes. Before the
dividend, the company had earnings per share of $1.68. As a result of
this dividend, the:

Retained earnings will decrease by $350,000.
Earnings per share will increase to $3.
Total firm value will not change.
Price-earnings ratio will be 12.55.
Retained earnings will increase by $462,000.
The common stock of Dayton Repair sells for $43.19 a share. The
stock is expected to pay $2.28 per share next year when the annual
dividend is distributed. The firm has established a pattern of
increasing its dividends by 2.15 percent annually and expects to
continue doing so. What is the market rate of return on this stock?
7.67 percent
7.59 percent
7.43 percent
7.14 percent
7.28 percent
Which one of the following should earn the most risk premium based
on CAPM?
Diversified portfolio with returns similar to the overall market.
Stock with a beta of 1.38.
Portfolio with a beta of 1.01.
U.S. Treasury bill.
Stock with a beta of 0.74.
Which one of these actions will increase the operating cycle? Assume
all else held constant.

Decreasing the receivables turnover rate.
Decreasing the payables period.
Decreasing the average inventory level.
Increasing the payables period.
Increasing the inventory turnover rate.
Oil Wells offers 6.5 percent coupon bonds with semiannual payments
and a yield to maturity of 6.94 percent. The bonds mature in seven
years. What is the market price per bond if the face value is $1,000?
$902.60
$996.48
$913.48
$989.70
$975.93
Three Corners Markets paid an annualdividend of $1.37 a share last
month. Today, the company announced that future dividends will be
increasing by 2.8 percent annually. If you require a return of 11.6
percent, how much are you willing to pay to purchase one share of
this stock today?
$16.67
$16.00
$18.23
$17.68
$15.57
Which one of the following is a source of cash?

Granting credit to a customer
Purchase of inventory
Acquisition of debt
Payment to a supplier
Repurchase of common stock
Nadine’s Home Fashions has $2.12 million in net working capital.
The firm has fixed assets with a book value of $31.64 million and a
market value of $33.9 million. The firm has no long-term debt. The
Home Centre is buying Nadine’s for $37.5 million in cash. The
acquisition will be recorded using the purchase accounting method.
What is the amount of goodwill that The Home Centre will record on
its balance sheet as a result of this acquisition?
$5.86 million
$3.34 million
$4.14 million
$1.48 million
$3.74 million
Chelsea Fashions is expected to pay an annual dividend of $1.10 a
share next year. The market price of the stock is $21.80 and the
growth rate is 4.5 percent. What is the firm’s cost of equity?
9.55 percent
10.54 percent
9.24 percent
7.91 percent
9.77 percent

Operating leverage is the degree of dependence a firm places on its:
Depreciation tax shield.
Variable costs.
Fixed costs.
Operating cash flows.
Sales.
Phillips Equipment has 75,000 bonds outstanding that are selling at
par. Bonds with similar characteristics are yielding 7.5 percent. The
company also has 750,000 shares of 6 percent preferred stock and 2.5
million shares of common stock outstanding.The preferred stock sells
for $64 a share. The common stock has a beta of 1.21 and sells for
$44 a share. The U.S. Treasury bill is yielding 2.3 percent and the
return on the market is 11.2 percent. The corporate tax rate is 34
percent. What is the firm’s weighted average cost of capital?
11.56 percent
11.30 percent
11.18 percent
10.64 percent
9.69 percent
Andy deposited $3,000 this morning into an account that pays 5
percent interest, compounded annually. Barb also deposited $3,000
this morning into an account that pays 5 percent interest,
compounded annually. Andy will withdraw his interest earnings and
spend it as soon as possible. Barb will reinvest her interest earnings
into her account. Given this, which one of the following statements is
true?
Barb will earn more interest the second year than Andy.

Barb will earn more interest the first year than Andy will.
Andy will earn compound interest.
Andy will earn more interest in year three than Barb will.
After five years, Andy and Barb will both have earned the same
amount of interest.
When utilizing the percentage of sales approach, managers:
Estimate company sales based on a desired level of net income and
the current profit margin.
Consider only those assets that vary directly with sales.
III. Consider the current production capacity level.
Can project both net income and net cash flows.
III and IV only
I, III, and IV only
II and III only
II, III, and IV only
I and II only
You are comparing two investment options that each pay 6 percent
interest compounded annually. Both options will provide you with
$12000 of income. Option A pays $2,000 the first year followed by
two annual payments of $5,000 each. Option B pays three annual
payments of $4,000 each. Which one of the following statements is
correct given these two investment options? Assume a positive
discount rate.
Option B is a perpetuity.
Option B has a higher present value at time zero.

Both options are of equal value since they both provide $12,000 of
income.
Option A has the higher future value at the end of year three.
Option A is an annuity.
The condition stating that the interest rate differential between two
countries is equal to the percentage difference between the forward
exchange rate and the spot exchange rate is called:
Uncovered interest rate parity.
The unbiased forward rates condition.
Purchasing power parity.
Interest rate parity.
The international Fisher effect.
The Dry Dock is considering a project with an initial cost of $118400.
The project’s cash inflows for years 1 through 3 are $37200,$54600
and $46900, respectively. What is the IRR of this project?
8.42 percent
7.48 percent
8.56 percent
8.04 percent
8.22 percent
The 7 percent bonds issued by Modern Kitchens pay interest
semiannually mature in eight years and have a $1000 face value.
Currently, the bonds sell for $1,032. What is the yield to maturity?
7.20 percent

6.87 percent
6.48 percent
6.92 percent
6.08 percent
Al invested $7200 in an account that pays 4 percent simple interest.
How much money will he have at the end of five years?
$8,678
$8,710
$8,299
$8,056
$8,640
All of the following represent potential gains from an acquisition
except the:
Use of surplus funds.
Tax loss carryovers acquired in the acquisition.
Obtainment of a beachhead.
Diseconomies of scale related to increased labor demand.
Lower costs per unit realized.
Fresno Salads has current sales of $6000 and a profit margin of 6.5
percent. The firm estimates that sales will increase by 4 percent next
year and that all costs will vary in direct relationship to sales. What is
the pro forma net income?
$438.70
$327.18

$405.60
$303.33
$441.10
A news flash just appeared that caused abouta dozen stocks to
suddenly drop in value by 20 percent. What type of risk does this news
flash best represent?
Market
Unsystematic
Portfolio
Total
Non-diversifiable
Which one of the following terms is defined as the mixture of a firm’s
debt and equity financing?
Cash management
Cost analysis
Working Capital Management
Capital Structure
Capital budgeting
George and Pat just made an agreement to exchange currencies
based on today’s exchange rate. Settlement will occur tomorrow.
Which one of the following is the exchange rate that applies to this
agreement?
Forward exchange rate
Triangle rate

Cross rate
Current rate
Spot exchange ratends will have decreasing values.
*******************************************************
FIN 370 Week 1 Apply: Finance and Financial
Statement Analysis Homework
FIN 370 Week 1 Apply: Finance and Financial Statement
Analysis Homework
Review the Week 1 “Practice: Finance and Financial Statement
Analysis Quiz” in Connect®.
Complete the Week 1 “Apply: Finance and Financial Statement
Analysis Homework” in Connect®.
Which of the following is the firm’s highest-level financial manager?
Multiple Choice
 chief executive officer
 corporate governance
 chief financial officer
 board of directors

Which of these must effectively distribute capital between investors
and companies?
Multiple Choice
 companies
 individuals
 international investors
 financial institutions
Which of the following statements is correct?
Multiple Choice
 Financial managers double-check the accountant’s statements.
 Accountants are focused on what happened in the past.
 Both accountants and financial managers use total quality
management systems to standardize data.
 Financial managers are focused on what happened in the past.
This is a general term for securities like stocks, bonds, and other
assets that represent ownership in a cash flow.
Multiple Choice
 investment
 real asset
 financial asset
 financial markets
The portion of a company’s profits that are kept by the company
rather than distributed to the stockholders as cash dividends is
referred to as
Multiple Choice
 institutional investment.
 restricted earnings.
 venture capital.
 retained earnings.
A potential future negative impact to value and/or cash flows is often
discussed in terms of probability of loss and the expected magnitude
of the loss. This is called
Multiple Choice
 risk.
 options.
 standard deviation.
 coefficient of variation.

Multiple Choice
 market instruments
 asset classes
 investments
What is the difference in perspective between finance and
accounting?
Multiple Choice
 ownership
 timing
 liability
 risk
This subarea of finance is important for adapting to the global
economy.
Multiple Choice
 financial management
 financial institutions and markets
 investments
 international finance
stated as
Multiple Choice
 maximizing net income.
 maximizing retained earnings.
 maximizing the stock price.
 maximizing earnings per share.
Which of the following is NOT a function of the board of directors?
Multiple Choice
 evaluate the CEO
 design compensation contracts for the CEO
 provide reports to the auditors
 hire the CEO

This is the set of laws, policies, incentives, and monitors designed to
handle the issues arising from the separation of ownership and
control.
Multiple Choice
 defined benefit plan
 invisible hand
 agency theory
Which of the following statements is incorrect?
Multiple Choice
 Most sole proprietors raise money by borrowing from banks.
 S corporations are considered a hybrid organization.
 An advantage of sole proprietorships is that the owner has
complete control.
 Partnerships have unlimited liability.
Agency problems exist in which forms of business ownership?
Multiple Choice
 partnership
 sole proprietorship
 corporation
 S corporation
Multiple Choice
 investment time frame.
 voting rights.
 type of investment.
 size of investment.
Which statement is incorrect regarding hybrid organizations?
Multiple Choice
 They offer single taxation.
 They offer limited risk to the owners.
 They offer the same type of control as a sole proprietorship.
 All of these choices are correct.
From a taxation perspective, the form of business organization with
the highest business level taxes is the

Multiple Choice
 S corporation.
 corporation.
 sole proprietorship.
 partnership.
Corporate stakeholders include all of the following EXCEPT
Multiple Choice
 employees.
 suppliers.
 shareholders.
 auditors.
From the perspective of ownership risk, the best form of business
organization is the
Multiple Choice
 partnership.
 corporation.
 S corporation.
Multiple Choice
 all of these choices are correct.
 limited partnership
 S corporation
 limited liability company
 limited liability partnership
Multiple Choice
 corporate Governance
 checks and Balances
 Security Exchange Commission
 board of Directors
When determining a form of business organization, all of the
following are considered EXCEPT
Multiple Choice
 the physical location of the business.
 who owns the firm.

 the tax ramifications.
 the owners’ risks.
EXCEPT
Multiple Choice
 a financial advisor advises her clients.
 the shareholder elects a board member.
 a bank employee manages deposits.
 a CEO manages the firm.
Restricted stock is
Multiple Choice
 a special type of stock that can be converted into corporate
bonds after a specific amount of time has elapsed.
 a special type of stock that is not transferable from the current
holder to others until specific conditions are satisfied.
 a special type of stock that is a result of offering an employee
stock ownership plan.
Multiple Choice
 liquidity
 internal-growth
 cross-section
 market value
Which of the following measures the number of days accounts
receivable are held before the firm collects cash from the sale?
Multiple Choice
 accounts receivable turnover
 average payment period
 accounts payable turnover
 average collection period
Which ratio measures the number of dollars of operating earnings
available to meet the firm’s interest dollars and other fixed charges?
Multiple Choice
 fixed-charge coverage ratio
 basic earning power
 times interest earned

 ROA
Which ratio measures the operating return on the firm’s assets
irrespective of financial leverage and taxes?
Multiple Choice
 profit margin
 basic earning power ratio
 operating leverage return
 return on assets
A firm has EBIT of $1,000,000 and depreciation expense of
$400,000. Fixed charges total $600,000. Interest expense totals
$70,000. What is the firm’s fixed-charge coverage ratio?
Multiple Choice
 2.45 times
 1.67 times
 1.00 times
 2.33 times
Which of these ratios measure the extent to which the firm uses debt
(or financial leverage) versus equity to finance its assets?
Multiple Choice
 debt management ratios
 financial ratios
 liquidity ratios
 equity ratios
A strong liquidity position means that
Multiple Choice
 the firm is able to meet its short-term obligations.
 the firm pays out a large portion of its net income in the form of
dividends.
 the firm uses little debt in its capital structure.
 the firm pays its creditors on time.
Which type of ratio measures the dollars of current assets available to
pay each dollar of current liabilities?
rev: 08_14_2018_QC_CS-133354
Multiple Choice
 internal-growth
 current

 cross-section
 quick or acid-test
A firm has EBIT of $300,000 and depreciation expense of $12,000.
Fixed charges total $44,000. Interest expense totals $7,000. What is
the firm’s cash coverage ratio?
Multiple Choice
 7.09 times
 3.76 times
 7.25 times
 4.91 times
Incorrect
Which of the following measures the number of dollars of sales
produced per dollar of fixed assets?
Multiple Choice
 fixed asset to working capital ratio
 fixed asset management ratio
 sales to working capital ratio
 fixed asset turnover ratio
The term “capital structure” refers to
Multiple Choice
 the amount of current versus fixed assets on the balance sheet.
 the amount of long-term debt versus equity on the balance sheet.
 the amount of current versus long-term debt on the balance
sheet.
A firm reported year-end cost of goods sold of $10 million. It listed
$2 million of inventory on its balance sheet. Using a 365-day year,
how many days did the firm’s inventory stay on the premises?
Multiple Choice
 73 days
 2 days
 20 days
 18.25 days
Tops N Bottoms Corp. reported sales for 2018 of $50 million. Tops N
Bottoms listed $4 million of inventory on its balance sheet. Using a
365-day year, how many days did Tops N Bottoms’ inventory stay on
the premises? How many times per year did Tops N Bottoms’
inventory turn over?

Multiple Choice
 29.2 days, 0.0345 times, respectively
Which ratio measures how many days inventory is held before the
final product is sold?
Multiple Choice
 total asset turnover
 inventory turnover
 days’ sales in inventory
 inventory intensity ratio
available to meet each dollar of interest obligations on the firm’s
debt?
Multiple Choice
 ROA
 cash coverage ratio
You are considering a stock investment in one of two firms
(LotsofDebt, Inc. and LotsofEquity, Inc.), both of which operate in
the same industry. LotsofDebt, Inc. finances its $100 million in assets
with $90 million in debt and $10 million in equity. LotsofEquity, Inc.
finances its $100 million in assets with $10 million in debt and $90
million in equity. What are the debt ratio, equity multiplier, and debt-
to-equity ratio for the two firms?
Multiple Choice
 LotsofDebt: 90 percent, 10 times, 9 times, respectively; and
LotsofEquity: 10 percent, 1.11 times, 0.1111 times, respectively
 LotsofDebt: 10 percent, 1.11 times, 0.1111 times, respectively;
and LotsofEquity: 90 percent, 10 times, 9 times, respectively

A firm has an ACP of 38 days and its annual sales are $5.3 million.
What is its account receivable balance?
Multiple Choice
 $759,021
 $619,304
 $551,781
 $692,098
Tina’s Track Supply’s market-to-book ratio is currently 4.5 times and
PE ratio is 10.5 times. If Tina’s Track Supply’s common stock is
currently selling at $100 per share, what is the book value per share
and earnings per share?
Multiple Choice
 $9.5238, $22.2222, respectively
 $1,050, $450, respectively
 $450, $1,050, respectively
 $22.2222, $9.5238, respectively
Bree’s Tennis Supply’s market-to-book ratio is currently 9.4 times
and PE ratio is 20 times. If Bree’s Tennis Supply’s common stock is
currently selling at $20.50 per share, what is the book value per share
Multiple Choice
 $192.70, $410.00, respectively
 $1.025, $2.1809, respectively
 $410.00, $192.70, respectively
 $2.1809, $1.025, respectively
An investor wanting large returns will be interested in companies that
have
Multiple Choice

high current ratios.
 high times interest earned.
 high ROEs.
 high ROAs.
Which of the following measures the operating return on the firm’s
assets, irrespective of financial leverage and taxes?
Multiple Choice
 return on equity

 basic earnings power ratio
 profit margin
Multiple Choice
 profitability ratios
 market value ratios
 price value ratios
According to the list provided in the textbook, which of the following
is NOT one of the cautions in using ratios to evaluate firm
performance?
rev: 07_10_2017_QC_CS-93252
Multiple Choice
 The firm has different accounting procedures.
 The firm has seasonal cash flow differences.
 The firm had a one-time event.
 The firm has a different capital structure.
Multiple Choice
 competitive analysis
 time series analysis
 cross-industry analysis
 time-industry analysis
Last year Mocha Java, Inc. had an ROA of 10 percent, a profit margin
of 5 percent, and sales of $25 million. What is Mocha Java’s total
assets?
Multiple Choice
 $0.125m.
 $1.25m.
 $12.5m.
 $12m.

Last year Rain Repel Corporation had an ROE of 10 percent and a
dividend payout ratio of 80 percent. What is the sustainable growth
rate?
Multiple Choice
 50.00 percent
 2.04 percent
44.44 percent
1.11 percent
*******************************************************
FIN 370 Week 1 Apply: Week 1 Exercise
Materials
 Learn: McGraw-Hill Connect® Access
Maximizing owners’ equity value means carefully considering all of
the following EXCEPT
Multiple Choice
 how best to return the profits from those projects to the owners
over time.

 which projects to invest in.
 how to best bring additional funds into the firm.
 how best to increase the firm’s risk.
Not all cash a company generates will be returned to the investors.
Which of the following will NOT reduce the amount of capital
returned to the investors?
Multiple Choice
 taxes
 dividends
 retained earnings
As individual legal entities, corporations assume liability for their
own debts, so the shareholders hold
Multiple Choice
 unlimited liability.
 shared liability.
 joint liability.
 only limited liability.
stated as
Multiple Choice
Which of the following is not an impact of the slowdown occurring in
China’s economy?
Multiple Choice
 falling community prices
 lower demand in materials such as steel, iron ore, and copper
 real estate market declining in Sydney, Australia
 money going out of Manhattan, New York
What is the debt ratio for a firm with an equity multiplier of 3.5?
Multiple Choice
 58.51 percent
 66.25 percent
 44.09 percent

 71.43 percent
Multiple Choice
 internal-growth
 market value
 liquidity
 cross-section
Multiple Choice
earnings?
Multiple Choice
 sustainable growth rate
 weighted growth rate
 internal growth rate
 retained earnings growth rate
Multiple Choice
*******************************************************
FIN 370 Week 1 Calculating Ratios Worksheet
(2 Set)

This Tutorial contains 2 Set of Answers
FIN 370 Week 1 Calculating Ratios Worksheet
1. What is “agency theory?” How can setting the appropriate
goals for the firm minimize the agency problem?
2. Differentiate between profit maximization and wealth
maximization.
3. Why must organizations focus on both shareholder wealth and
the stakeholders?
4. Differentiate between the three financial statements with which
managers should be familiar. How are they linked?
*******************************************************
FIN 370 Week 1 Calculating RatiosLake of
Egypt Marina (3-29, 3-30)

FIN 370 Week 1 Calculating Ratios
Review the financial statements for Lake of Egypt Marina, Inc.
Complete the following problem sets from Chapter 3 in Microsoft®
Excel®:
· 3-29 Spreading the Financial Statements
· 3-30 Calculating Ratios
Format your assignment consistent with APA guidelines.
Click the Assignment Files tab to submit your assignment
*******************************************************
FIN 370 Week 1 Practice: Finance and
Financial Statement Analysis Quiz

FIN 370 Week 1 Practice: Finance and Financial Statement
Analysis Quiz
Complete the Week 1 “Practice: Finance and Financial Statement
Analysis Quiz” in Connect®.
Note: You have unlimited attempts available to complete practice
assignments. The highest scored attempt will be recorded.
These assignments have earlier due dates, so plan accordingly.
Grades must be transferred manually to eCampus by your instructor.
Don’t worry, this might happen after your due date.
Which of the following is the firm’s highest-level financial manager?
Multiple Choice
 chief executive officer
 chief financial officer
 board of directors
Which of these must effectively distribute capital between investors
and companies?
Multiple Choice
 companies
 individuals

international investors
 financial institutions
Multiple Choice
 Financial managers double-check the accountant’s statements.
 Accountants are focused on what happened in the past.
 Both accountants and financial managers use total quality
management systems to standardize data.
 Financial managers are focused on what happened in the past.
 This is a general term for securities like stocks, bonds, and other
assets that represent ownership in a cash flow.
Multiple Choice
 investment
 real asset
 financial asset

The portion of a company’s profits that are kept by the company
rather than distributed to the stockholders as cash dividends is
referred to as
Multiple Choice
 institutional investment.
 restricted earnings.
 venture capital.
 retained earnings.
A potential future negative impact to value and/or cash flows is often
discussed in terms of probability of loss and the expected magnitude
of the loss. This is called
Multiple Choice
 risk.
 options.
 standard deviation.
 coefficient of variation.
Multiple Choice
 market instruments
 asset classes
 investments
What is the difference in perspective between finance and
accounting?
Multiple Choice
 ownership
 timing
 liability
 risk
This subarea of finance is important for adapting to the global
economy.
Multiple Choice
 financial management

 financial institutions and markets
 investments
 international finance
stated as
Multiple Choice
Which of the following is NOT a function of the board of directors?
Multiple Choice
 evaluate the CEO
 design compensation contracts for the CEO
 provide reports to the auditors
 hire the CEO
This is the set of laws, policies, incentives, and monitors designed to
handle the issues arising from the separation of ownership and
control.
Multiple Choice
 defined benefit plan
 invisible hand
 agency theory
Which of the following statements is incorrect?
Multiple Choice
 Most sole proprietors raise money by borrowing from banks.
 S corporations are considered a hybrid organization.
 An advantage of sole proprietorships is that the owner has
complete control.
 Partnerships have unlimited liability.
Agency problems exist in which forms of business ownership?
Multiple Choice
 partnership
 sole proprietorship

 corporation
 S corporation
 An angel investor differs from a venture capitalist because of the
Multiple Choice
 voting rights.
 size of investment.
Which statement is incorrect regarding hybrid organizations?
Multiple Choice
 They offer single taxation.
 They offer limited risk to the owners.
 They offer the same type of control as a sole proprietorship.
From a taxation perspective, the form of business organization with
the highest business level taxes is the
Multiple Choice
 S corporation.
 corporation.
 partnership.
Corporate stakeholders include all of the following EXCEPT
Multiple Choice
 employees.
 suppliers.
 shareholders.
 auditors.
From the perspective of ownership risk, the best form of business
organization is the
Multiple Choice
 partnership.
 corporation.
 S corporation.
Multiple Choice
 all of these choices are correct.

 limited partnership
 S corporation
 limited liability company
 limited liability partnership
Multiple Choice
 corporate Governance
 checks and Balances
 Security Exchange Commission
 board of Directors
When determining a form of business organization, all of the
following are considered EXCEPT
Multiple Choice
 the physical location of the business.
 who owns the firm.
 the tax ramifications.
 the owners’ risks.
EXCEPT
Multiple Choice
 a CEO manages the firm.
Restricted stock is
Multiple Choice
 a special type of stock that can be converted into corporate
bonds after a specific amount of time has elapsed.
 a special type of stock that is not transferable from the current
holder to others until specific conditions are satisfied.
 a special type of stock that is a result of offering an employee
stock ownership plan.
Multiple Choice

 liquidity
 internal-growth
 cross-section
 market value
Which of the following measures the number of days accounts
receivable are held before the firm collects cash from the sale?
Multiple Choice
 accounts receivable turnover
 average payment period
 accounts payable turnover
available to meet the firm’s interest dollars and other fixed charges?
Multiple Choice
 ROA
Which ratio measures the operating return on the firm’s assets
irrespective of financial leverage and taxes?
Multiple Choice
 profit margin
 basic earning power ratio
 operating leverage return
A firm has EBIT of $1,000,000 and depreciation expense of
$400,000. Fixed charges total $600,000. Interest expense totals
$70,000. What is the firm’s fixed-charge coverage ratio?
Multiple Choice
 2.45 times
 1.67 times
 1.00 times
 2.33 times

Which of these ratios measure the extent to which the firm uses debt
(or financial leverage) versus equity to finance its assets?
Multiple Choice
 debt management ratios
 financial ratios
 equity ratios
A strong liquidity position means that
Multiple Choice
 the firm is able to meet its short-term obligations.
 the firm pays out a large portion of its net income in the form of
dividends.
 the firm uses little debt in its capital structure.
 the firm pays its creditors on time.
Which type of ratio measures the dollars of current assets available to
pay each dollar of current liabilities?
rev: 08_14_2018_QC_CS-133354
Multiple Choice
 internal-growth
 current
 cross-section
 quick or acid-test
A firm has EBIT of $300,000 and depreciation expense of $12,000.
Fixed charges total $44,000. Interest expense totals $7,000. What is
the firm’s cash coverage ratio?
Multiple Choice
 7.09 times
 3.76 times
 7.25 times
 4.91 times
Incorrect
Which of the following measures the number of dollars of sales
produced per dollar of fixed assets?
Multiple Choice
 fixed asset to working capital ratio
 fixed asset management ratio
 sales to working capital ratio

 fixed asset turnover ratio
The term “capital structure” refers to
Multiple Choice
 the amount of current versus fixed assets on the balance sheet.
 the amount of long-term debt versus equity on the balance sheet.
 the amount of current versus long-term debt on the balance
sheet.
A firm reported year-end cost of goods sold of $10 million. It listed
$2 million of inventory on its balance sheet. Using a 365-day year,
how many days did the firm’s inventory stay on the premises?
Multiple Choice
 73 days
 2 days
 20 days
 18.25 days
Tops N Bottoms Corp. reported sales for 2018 of $50 million. Tops N
Bottoms listed $4 million of inventory on its balance sheet. Using a
365-day year, how many days did Tops N Bottoms’ inventory stay on
the premises? How many times per year did Tops N Bottoms’
inventory turn over?
Multiple Choice
Which ratio measures how many days inventory is held before the
final product is sold?
Multiple Choice
 total asset turnover
 inventory turnover
 days’ sales in inventory
 inventory intensity ratio

available to meet each dollar of interest obligations on the firm’s
debt?
Multiple Choice
 ROA
You are considering a stock investment in one of two firms
(LotsofDebt, Inc. and LotsofEquity, Inc.), both of which operate in
the same industry. LotsofDebt, Inc. finances its $100 million in assets
with $90 million in debt and $10 million in equity. LotsofEquity, Inc.
finances its $100 million in assets with $10 million in debt and $90
million in equity. What are the debt ratio, equity multiplier, and debt-
to-equity ratio for the two firms?
Multiple Choice
A firm has an ACP of 38 days and its annual sales are $5.3 million.
What is its account receivable balance?
Multiple Choice
 $759,021
 $619,304
 $551,781
 $692,098
Tina’s Track Supply’s market-to-book ratio is currently 4.5 times and
PE ratio is 10.5 times. If Tina’s Track Supply’s common stock is
currently selling at $100 per share, what is the book value per share
Multiple Choice
 $9.5238, $22.2222, respectively

 $1,050, $450, respectively
 $450, $1,050, respectively
 $22.2222, $9.5238, respectively
Bree’s Tennis Supply’s market-to-book ratio is currently 9.4 times
and PE ratio is 20 times. If Bree’s Tennis Supply’s common stock is
currently selling at $20.50 per share, what is the book value per share
Multiple Choice
 $192.70, $410.00, respectively
 $1.025, $2.1809, respectively
 $410.00, $192.70, respectively
 $2.1809, $1.025, respectively
An investor wanting large returns will be interested in companies that
have
Multiple Choice
 high current ratios.
 high times interest earned.
 high ROEs.
 high ROAs.
Which of the following measures the operating return on the firm’s
assets, irrespective of financial leverage and taxes?
Multiple Choice
 return on equity
 basic earnings power ratio
 profit margin
Multiple Choice
According to the list provided in the textbook, which of the following
is NOT one of the cautions in using ratios to evaluate firm
performance?
rev: 07_10_2017_QC_CS-93252

Multiple Choice
 The firm has different accounting procedures.
 The firm has seasonal cash flow differences.
 The firm had a one-time event.
 The firm has a different capital structure.
Multiple Choice
Last year Mocha Java, Inc. had an ROA of 10 percent, a profit margin
of 5 percent, and sales of $25 million. What is Mocha Java’s total
assets?
Multiple Choice
 $0.125m.
 $1.25m.
 $12.5m.
 $12m.
Last year Rain Repel Corporation had an ROE of 10 percent and a
dividend payout ratio of 80 percent. What is the sustainable growth
rate?
Multiple Choice
 50.00 percent
 2.04 percent
44.44 percent
1.11 percent
*******************************************************
FIN 370 Week 1 Practice: Week 1 Knowledge
Check

FIN 370 Week 1 Practice: Week 1 Knowledge Check
MC Qu. 1-14 Which of the following managers would…
Which of the following managers would NOT use finance?
Multiple Choice
 human resource managers
 marketing managers
 operational managers
MC Qu. 1-11 Which of the following is defined…
Multiple Choice

market instruments
investments
financial markets
asset classes
MC Qu. 1-63 An angel investor differs from a…
Multiple Choice
size of investment.
 voting rights.

MC Qu. 1-18 This type of business organization is…
This type of business organization is entirely legally independent
from its owners.
Multiple Choice
hybrid organizations
partnership
sole proprietorship
public corporations
MC Qu. 1-67 Which of these is the system…
Multiple Choice
checks and Balances
Security Exchange Commission
board of Directors
corporate Governance
MC Qu. 1-54 From the perspective of control, the…
From the perspective of control, the best form of business
organization is the
Multiple Choice
corporation.
partnership.
S corporation.
sole proprietorship.
MC Qu. 1-19 Which of the following is…
Multiple Choice
limited liability partnership
limited liability company
limited partnership
S corporation
MC Qu. 1-1 The increase in oil production in…
The increase in oil production in the United States characterizes
which of the following key financial concepts presented in this book?

Multiple Choice
the Rule of 72
time value of money
capital budgeting
risk and return
MC Qu. 1-59 All of the following are an…
EXCEPT
Multiple Choice

a CEO manages the firm.
MC Qu. 3-85 Which ratio assesses how efficiently a…
Which ratio assesses how efficiently a firm uses its fixed assets?
Multiple Choice
 capital intensity ratio
 current ratio
 fixed asset turnover
MC Qu. 3-90 A firm reported working capital of…
A firm reported working capital of $5.5 million and fixed assets of
$20 million. Its fixed asset turnover was 1.2 times. What was the
firm’s sales to working capital ratio?
Multiple Choice
 4.36 times
6.03 times
 2.21 times
 5.19 times
MC Qu. 3-103 Which ratio measures the number of…
Which ratio measures the number of dollars of operating cash
available to meet each dollar of interest and other fixed charges that
the firm owes?
Multiple Choice

 operating coverage ratio
MC Qu. 3-25 You are evaluating the balance sheet…
You are evaluating the balance sheet for Blue Jays Corporation. From
the balance sheet you find the following balances: cash and
marketable securities = $200,000, accounts receivable = $800,000,
inventory = $1,000,000, accrued wages and taxes = $250,000,
accounts payable = $400,000, and notes payable = $300,000. What
are Blue Jays’ current ratio, quick ratio, and cash ratio, respectively?
Multiple Choice
 3.07692, 1.53846, 0.30769
 1.05263, 1.05263, 0.21053
 2.10526, 1.05263, 0.21053
 3.07692, 1.05263, 0.30769
MC Qu. 3-6 Which of the following ratios measure…
Which of the following ratios measure how efficiently a firm uses its
assets, as well as how efficiently the firm manages its accounts
payable?
Multiple Choice

quick or acid-test
 cash
 internal-growth
 asset management
MC Qu. 3-20 For publicly traded firms, which of…
Multiple Choice
MC Qu. 3-116 Which ratio measures the overall return…
Which ratio measures the overall return on the firm’s assets including
financial leverage and taxes?
Multiple Choice

 ROE
 ROA
 profit margin
MC Qu. 3-112 The maximum growth rate that can…
The maximum growth rate that can be achieved by financing asset
growth with internal financing or retained earnings is called the
Multiple Choice
 internal growth rate.
 sustainable growth rate.
 retention rate.
 operating expansion rate.
MC Qu. 3-22 Which of the following is the…
earnings?
Multiple Choice
 weighted growth rate
 internal growth rate
 sustainable growth rate
 retained earnings growth rate
MC Qu. 3-23 To interpret financial ratios, managers, analysts,…
Multiple Choice
MC Qu. 3-42 Last year Poncho Villa Corporation had…
Last year Poncho Villa Corporation had an ROA of 16 percent and a
dividend payout ratio of 25 percent. What is the internal growth rate?
Multiple Choice
 13.64 percent
 33.33 percent
 25.40 percent

 1.19 percent
*******************************************************
FIN 370 Week 1 Question and Problem Sets (Ch
1: Q 3,11 Ch 2: Q4,9, CH 3: Q4,7, Ch 4: Q 1,6)
Purpose of Assignment
Complete the following Questions and Problems (Concepts and
Critical Thinking Questions for Ch. 1 Only) from each chapter as
indicated.
Show all work and analysis.
Prepare in Microsoft® Excel® or Word.
• Ch. 1: Questions 3 & 11 (Concepts Review and Critical Thinking
Questions section)
• Ch. 2: Questions 4 & 9 (Questions and Problems section):
Microsoft® Excel® template provided for Problem 4.
• Ch. 3: Questions 4 & 7 (Question and Problems section)
• Ch. 4: Questions 1 & 6 (Questions and Problems section):

Format your assignment consistent with APA guidelines if submitting
in Microsoft® Word.
Click the Assignment Files tab to submit your assignment.
Ch. 1: Questions 3 & 11 (Concepts Review and Critical Thinking
Questions section)
3. Corporations [LO3] What is the primary disadvantage of the
corporate form of organization? Name at least two advantages of
corporate organization.
11. Goal of the Firm [LO2] Evaluate the following statement:
Managers should not focus on the current stock value because doing
so will lead to an overemphasis on short-term profits at the expense of
long-term profits.
Ch. 2: Questions 4 & 9 (Questions and Problems section):
Building an Income Statement [LO1] Billy’s Exterminators, Inc., has
sales of $817,000, costs of $343,000,depreciation expense of
$51,000, interest expense of $38,000, and a tax rate of 35 percent.
What is the net income for this firm?
3. Dividends and Retained Earnings [LO1] Suppose the firm in
Problem 2 paid out $95,000 in cash dividends. What is the addition to
retained earnings?

4. Per-Share Earnings and Dividends [LO1] Suppose the firm in
Problem 3 had 90,000 shares of common stock outstanding. What is
the earnings per share, or EPS, figure? What is the dividends per
share figure?
9. Calculating Additions to NWC [LO4] The 2014 balance sheet of
Steelo, Inc., showed current assets of $4,630 and current liabilities of
$2,190. The 2015 balance sheet showed current assets of $5,180 and
current liabilities of $2,830. What was the company’s 2015 change in
net working capital, or NWC?
• Ch. 3: Questions 4 & 7 (Question and Problems section)
4. Calculating Inventory Turnover [LO2] The Green Corporation
has ending inventory of $417,381, and cost of goods sold for the year
just ended was $4,682,715. What is the inventory turnover? The days’
sales in inventory? How long on average did a unit of inventory sit on
the shelf before it was sold?
7. DuPont Identity [LO4] If Roten Rooters, Inc., has an equity
multiplier of 1.15, total asset turnover of 2.10, and a profit margin of
6.1 percent, what is its ROE?
Ch. 4: Questions 1 & 6 (Questions and Problems section):

1. Pro Forma Statements [LO1] Consider the following simplified
financial statements for the Yoo Corporation (assuming no income
taxes):
6. Calculating Internal Growth [LO3] The most recent financial
statements for Schenkel Co. are shown here:
Assets and costs are proportionalto sales. Debt and equity are not.
The company maintains a constant 30 percent dividend payout ratio.
What is the internal growth rate?
*******************************************************
FIN 370 Week 2 Apply: Time Value of Money
Homework
FIN 370 Week 2 Apply: Time Value of Money Homework
Review the Week 2 “Practice: Time Value of Money Quiz” in
Connect®.

Complete the Week 2 “Apply: Time Value of Money Homework” in
Connect®.
Note: You have only one attempt available to complete assignments.
Grades must be transferred manually to eCampus by your instructor.
Don’t worry, this might happen after your due date.
Multiple Choice
 larger than present values.
 equal to present values.
 smaller than present values.
Time value of money concepts can be used by
Multiple Choice
 CFOs and CEOs to make business decisions.
 individuals doing personal financial planning.
 investors calculating a return on an investment.
Multiple Choice
 $100 to be received in the future is worth more than that today
since it could be invested and earn interest.
 $100 to be received in the future is worth less than that today
since it could be invested and earn interest.
 Discounting is finding the future value of an original
investment.
 The Rule of 72 calculates the compounded return on
investments.
Multiple Choice
 $120
 $4,120
 $2,120
 $2.000
How much would be in your savings account in 10 years after
depositing $50 today if the bank pays 7 percent interest per year?
Multiple Choice

 $35.00
 $535.00
 $690.82
 $98.36
Which of the following statements is incorrect with respect to time
lines?
Multiple Choice
 Cash flows we receive are called inflows and denoted with a
positive number.
 A helpful tool for organizing our analysis is the time line.
 Interest rates are not included on our time lines.
 Cash flows we pay out are called outflows and designated with a
negative number.
What is the future value of $700 deposited for one year earning 4
Multiple Choice
 $1,428
 $728
 $28
 $700
Approximately what interest rate is needed to double an investment
over six years?
Multiple Choice

6 percent
 100 percent
 12 percent
 17 percent
What is the present value of a $750 payment made in three years
when the discount rate is 5 percent?
Multiple Choice
 $647.88
 $712.50
 $868.22
 $646.96
How are present values affected by changes in interest rates?
Multiple Choice

 One would need to know the future value in order to determine
the impact.
 The higher the interest rate, the larger the present value will be.
 The lower the interest rate, the larger the present value will be.
 Present values are not affected by changes in interest rates.
Multiple Choice
 11 years
 0.11 years
 4.17 years
 9 years
years?
Multiple Choice
 14.4 percent
 12.2 percent
 8 percent
 15.8 percent
The process of figuring out how much an amount that you expect to
receive in the future is worth today is called
Multiple Choice
 discounting.
 computing.
 multiplying.
 compounding.
over eight years?
Multiple Choice
 12 percent
 100 percent
 8 percent
 9 percent
Multiple Choice
 it is probably a “fad” investment.

 it does not reflect the effect of the Rule of 72.
 it does not reflect the effect of discounting.
 it does not reflect the effect of compounding.
Determine the interest rate earned on a $1,500 deposit when $1,680 is
Multiple Choice
 12.00 percent
 1.12 percent
 89.00 percent
 0.89 percent
When calculating the number of years needed to grow an investment
to a specific amount of money
Multiple Choice
 the lower the interest rate, the shorter the time period needed to
achieve the growth.
 the interest rate has nothing to do with the length of the time
period needed to achieve the growth.
 the higher the interest rate, the shorter the time period needed to
achieve the growth.
 the Rule of 72 is the only way to calculate the time period
needed to achieve the growth.
Level sets of frequent, consistent cash flows are called
Multiple Choice
 annuities.
 bills.
 budgets.
 loans.
When saving for future expenditures, we can add the ________ of
contributions over time to see what the total will be worth at some
point in time.
Multiple Choice
 present value
 future value
 payment
 time value to money
In order to discount multiple cash flows to the present, one would use
Multiple Choice

 the appropriate compound rate.
 the appropriate tax rate.
 the appropriate simple rate.
 the appropriate discount rate.
What is the future value of a $500 annuity payment over eight years if
interest rates are 14 percent?
Multiple Choice
 $6,809.72
 $6,616.38
 $6,750.14
 $6,241.09
What is the future value of an $800 annuity payment over 15 years if
Multiple Choice
 $12,720.00
 $7,002.99
 $18,620.78
 $1,917.25
What is the present value, when interest rates are 6.5 percent, of a
$100 payment made every year forever?
Multiple Choice
 $1,538.46
 $650.00
 $6.50
 $1,000.00
Your credit rating and current economic conditions will determine
Multiple Choice
 whether you get simple or compound interest.
 the interest rate that a lender will offer.
 how long discounting will affect you.
 how long compounding will affect you.
What is the present value of a $300 annuity payment over 5 years if
interest rates are 8 percent?
Multiple Choice
 $440.80
 $1,938.96
 $204.17

 $1,197.81
interest rates are 6 percent, what is the present value of the same
annuity due?
Multiple Choice
 $1,000.00
 $1,060.00
 $943.40
 $1,040.00
interest rates are 7 percent, what is the present value of the same
annuity due?
Multiple Choice
 $24,997.51
 $23,644.49
 $26,750.00
 $25,000.00
Compounding monthly versus annually causes the interest rate to be
effectively higher, and thus the future value
Multiple Choice
 is affected only if the calculation involves an annuity due.
 decreases.
 grows.
 is independent of the monthly compounding.
Loan amortization schedules show
Multiple Choice
 both the principal balance and interest paid per period.
 the interest paid per period only.
 the present value of the payments due.
 the principal balance paid per period only.
The simple form of an annualized interest rate is called the annual
percentage rate (APR). The effective annual rate (EAR) is a
Multiple Choice
 less accurate measure of the interest rate paid for monthly
compounding.
 concept that is only used because the law requires it, and is of no
use to a borrower.

 more accurate measure of the interest rate paid for monthly
compounding.
 measure that only applies to mortgages.
*******************************************************
You are offered a choice between $770 today and $815 one year from
today. Assume that interest rates are 4 percent. Which do you prefer?
Multiple Choice
$770 today at 3 percent interest rates
$815 one year from today
They are equivalent to each other.
$770 todayIf an average home in your town currently costs $250,000,
and house prices are expected to grow at an average rate of 3 percent
per year, what will a house cost in eight years?
Multiple Choice
$255,033.41
$316,692.52
$314,928.01

$255,043.97
Which of the following statements is incorrect with respect to time
lines?
Multiple Choice
Cash flows we pay out are called outflows and designated with a
negative number.
Cash flows we receive are called inflows and denoted with a positive
number.
A helpful tool for organizing our analysis is the time line.
Interest rates are not included on our time lines.
People borrow money because they expect
Multiple Choice
interest rates to rise.
the time value of money to apply only if they are saving money.
their purchases to give them the satisfaction in the future that
compensates them for the interest payments charged on the loan.
that consumers don’t need to calculate the impact of interest on their
purchases.
When your investment compounds, your money will grow in a(n)
__________ fashion.
Multiple Choice
exponential
static
linear
implied
Multiple Choice
$1,050
$2,050
$1,000
$1,005
If an average home in your town currently costs $350,000, and house
prices are expected to grow at an average rate of 3 percent per year,
what will an average house cost in “5” years?
Multiple Choice
$507,500.00

$405,745.93
$405,168.75
$402,500.00
value?
Multiple Choice
$615.62
$595.46
$671.02
$634.91
If an average home in your town currently costs $300,000, and house
prices are expected to grow at an average rate of 5 percent per year,
what will an average house cost in 10 years?
Multiple Choice
$483,153.01
$507,593.74
$488,688.39
$450,000.00
and on the earlier interest payments
Multiple Choice
multiplying.
discounting.
compounding.
computing.
How much would be in your savings account in 7 years after
depositing $100 today if the bank pays 5 percent interest per year?
Multiple Choice
$140.71
$814.20
$735.00
$135.00
What is the future value of $2,500 deposited for one year earning a 14
Multiple Choice

$2,550
$3,150
$2,950
$2,850
What is the future value of $600 deposited for four years earning an
11 percent interest rate annually?
Multiple Choice
$803.61
$910.84
$792.90
$899.23
Multiple Choice
$250.00
$245.00
$235.85
$265.00
Multiple Choice
$868.22
$647.88
$712.50
$646.96
Multiple Choice
12 years
8 years
0.08 year
8.33 years
years?
Multiple Choice
8 percent

14.4 percent
15.8 percent
12.2 percent
Multiple Choice
Discounting is finding the future value of an original investment.
$100 to be received in the future is worth more than that today since it
could be invested and earn interest.
The Rule of 72 calculates the compounded return on investments.
$100 to be received in the future is worth less than that today since it
could be invested and earn interest.
over four years?
Multiple Choice
4 percent
100 percent
25 percent
18 percent
Multiple Choice
$555.56
$575.09
$525.87
$498.61
Multiple Choice
Multiple Choice
$475.00
$476.19
$525.00

$500.00
over eight years?
Multiple Choice
8 percent
100 percent
9 percent
12 percent
Multiple Choice
$158.77
$515.42
$251.94
$150.00
When calculating the number of years needed to grow an investment
to a specific amount of money
Multiple Choice
the interest rate has nothing to do with the length of the time period
needed to achieve the growth.
the higher the interest rate, the shorter the time period needed to
achieve the growth.
the lower the interest rate, the shorter the time period needed to
achieve the growth.
the Rule of 72 is the only way to calculate the time period needed to
achieve the growth.
Determine the interest rate earned on a $1,500 deposit when $1,680 is
Multiple Choice
89.00 percent
12.00 percent
0.89 percent
1.12 percent

FIN 370 Enhance teaching / snaptutorial.com

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