chapter 3
The quick ratio is?
A more stringent measure than the current ratio.
Which of the following is NOT part of a corporation's capital structure?
Accounts payable
which of the following industries is LEAST defensive?
Automobile production
Which of the following is a lagging indicator?
Average prime rate
Which of the following is lagging indicator?
Average prime rate
An income statement?
Covers financial activity over a period of time
The current ratio formula is?
Current assets / current liabilities
The rate that the federal reserve bank charges member banks for overnight loans to meet their reserve requirement is called the?
Discount rate
Which of the following best describes GNP?
GDP, plus income earned by residents from overseas, minus income earned within the domestic economy by overseas residents?
Which of the following is NOT inclouded in the current assets section of a balance sheet?
Goodwill
Which of the following is considered a coincident economic indicator?
Index of industrial productions is a coincident indicator. The rest are leading indicators.
Which of the following is a coincident indicator?
Industrial production
Stimulating the economy through spending policies is known as?
Keynesianism
All of the following are true of the organizational structure of a balance sheet except?
Liquid items appear on the left and illiquid and fixed items appear on the right.
Open market operations of the federal reserve board cause direct changes in?
M1
An analyst comparing the stock prices of two similar market competitors would most be interested in their?
P/E ratio
The theory that reducing taxes and limiting government involvement in business activities stimulated economic growth is called?
Supply side
If the federal reserve board through the FOMC (federal open market committee) lowers the discount rate, which of the following will decline?
T-bill rate
Which situation would cause U.S exports to become less competitive than foreign exports?
The U.S dollar strengthens when compared to foreign currencies.
GDP is?
The sum of all goods and services produced in the U.S., computed in real dollars.
Which of the following would increase U.S exports?
Weakening dollar
Which measures a corporation's solvency?
Working capital
Which of the following is a lagging indicator?
average prime rate
All of the following are examples of defensive industries EXCEPT?
building materials
If the federal reserve is trying to stimulate the economy in a period of low inflation and and economic recession, it will?
buy bonds in the open market
which of the following indicated the generosity of the board of directors?
dividend payout ratio
Earnings per share measures
earnings available to common stock holders.
The normal business cycle starts with?
expansion
All of the following are considered lagging indicators except?
housing permits
If the gross domestic product of one year is compared to that of another year, the comparison would be most valid if it were made?
in constant dollars
The fed funds rate is the interest rate that?
one bank charges another for overnight borrowing.
Under what circumstance would the federal reserve sell treasury bonds in the open market?
to tighten the money supply