C214 Overview Concept Quiz

C214 OVERVIEW CONCEPT QUIZ The goal of the corporation is to: a. Maximize profits b. Maximize the stock price c. Maximize market share d. Minimize risk - CORRECT ANSWER -Maximize stock price Which of the following is not a requirement for an efficient market? a. Competitive market b. Well-managed firms c. Transparency d. Liquidity - CORRECT ANSWER -Liquidity What is the relationship between risk and required return? a. The two are independent b. Higher required return causes lower risk c. Higher risk causes higher required return d. None of the above - CORRECT ANSWER -Higher risk causes higher required return The value of money depends upon: a. The timing of the receipt b. The certainty of receipt c. Riskiness of receipt d. All of the above - CORRECT ANSWER -All of the above What is the purpose of the SEC 10-K filing requirement? a. Prevent insider training b. Promote transparency and market efficiency c. Regulate securities sales practices d. Prevent monopolies - CORRECT ANSWER -Promote transparency and market efficiency Which line item is not part of networking capital? a. Inventory b. Bonds c. Accounts Payable d. Accrued expenses - CORRECT ANSWER -Bonds Which action causes a cash outflow? a. Increase in accounts payable b. Decrease in accounts receivable c. Increase in inventory d. None of the above - CORRECT ANSWER -Increase in inventory Which of the following is correct? a. Gross PPE equals Net PPE plus depreciation expense b. Gross PPE equals Net PPE plus accumulated depreciation c. Net PPE equals Gross PPE plus depreciation expense d. None of the above - CORRECT ANSWER -Gross PPE equals Net PPE plus accumulated depreciation Net Margin is defined as: