Unit 16 - 19

You should expect which of these to occur when the dollar strengthens against other currencies? Imports will become more expensive Imports will become less expensive Inflation will go down Inflation will rise A) II and III B) I and IV C) II and IV D) I and III

1 and 2 As the dollar gains strength against other currencies, the cost of imports goes down in dollar terms. Domestic producers will need to compete with the less expensive imports. That keeps prices overall from rising, reducing inflationary pressures

In regards to fiscal policy, which of these statements is correct? Fiscal policy is considered the most efficient means to solve short-term economic problems. Fiscal policy is not considered the most efficient means to solve short-term economic problems. Fiscal policy refers to governmental budget decisions enacted by the U.S. President and Congress. Fiscal policy refers to governmental budget decisions enacted by the U.S. President and the cabinet. A) I and III B) II and IV C) I and IV D) II and III

2 and 3

It would be reasonable to expect an increase in exports from the United States if which of these occurred? The dollar strengthened against the euro The yen strengthened against the dollar The Swiss franc weakened against the dollar The dollar weakened against the British pound A) I and III B) II and III C) I and IV D) II and IV

2 and 4

An order is entered by a customer to sell at 30 stop limit. Once the order is entered, the stock trades in the following sequence: 32, 29, 31, and 33. The order would be executed and the investor would receive a price of 32 29 30 31

31

Question #4 of 10 Question ID: 1272004 Your client, Ann Porter, likes fast cars and has been saving for a high-end Italian sports car. She recently saw a report that said the dollar was likely to drop in the near future. She is concerned that this might affect her plans to buy her dream car next year. You tell her A) no, it should have no impact on her plans at all. B) yes, it will likely cost her more to buy the car if the dollar drops. C) she should not waste her money on a fancy car. D) yes, it will likely cost her less if the dollar drops.

B) yes, it will likely cost her more to buy the car if the dollar drops.

Which of the following best describes the size of a quote? It tells the number of shares the broker-dealer is willing to buy or sell at that price. It tells the number of shares that were traded in the OTC market the prior day. It tells the number of shares that were traded on the NYSE that day. It tells the number of shares the broker-dealer has in inventory.

It tells the number of shares the broker-dealer is willing to buy or sell at that price.

Which of the following are required in discretionary accounts? SEC approval to open the account FINRA approval to open the account Prompt approval by a principal following each discretionary trade Prior approval by a principal before each discretionary trade is placed

Prompt approval by a principal following each discretionary trade

Which of the following best describes how a sell stop at 39 order would be filled? The next available price after the market price falls to 39 The next available price after the market price rises to 39 The next price below 39 after the market falls to 39 The next price above 39 after the market rises to 39

The next available price after the market price falls to 39

Assets = liabilities + net worth is the A) price to book ratio. B) fully diluted earnings ratio. C) working capital formula. D) basic balance sheet equation

basic balance sheet equation

In order to calculate the earnings per share you would need information from A) the balance sheet and current market value. B) just the balance sheet. C) just the income statement. D) both the balance sheet and the income statement.

both the balance sheet and the income statement

Where on a balance sheet would you find the estimated value of a retail company's inventory? A) Current liabilities B) Net worth C) Current assets D) Fixed assets

current assets

All of the following would decrease the U.S. balance of payments deficit except A) an increase in exports of domestic goods from the United States. B) a decrease in dividend payments by U.S. companies to foreign investors. C) a decrease in imports of foreign goods into the United States. D) a decrease in purchases of U.S. securities by foreign investors. Explanation

d) a decrease in purchases of US securities by foreign invvestors

Which of the following is not a measure of a company's short-term liquidity? A) Current ratio B) Working capital C) Debt ratio D) Acid test ratio

debt ratio Debt ratio is the measure of a company's long-term debt as a percentage of net worth. The others are derived from current asset and current liabilities, focusing on a company's short-term liquidity and cash demands.

Seabird Coffee Company has just reported an unexpected increase in EBITDA this past quarter. This means they experience an increase in A) earnings before interest, taxes, depreciation, and amortization. B) inventory turnover. C) earnings available to common shareholders. D) employee benefit costs.

earnings before interest, taxes, depreciation, and amortization

Which of the following would likely be classified as a countercyclical industry? A) Food production B) Gold mining C) Auto manufacturing D) Home building

gold mining

Irksome Inc., makes components and peripherals for smart phones. Their line of bright florescent sparkly earbuds has taken off in Asia and is starting to gain popularity in the Americas and Europe, even in countries experiencing harder economic times. Irksome is an example of a A) countercyclical company. B) defensive company. C) growth company. D) cyclical company.

growth company

An industry whose products stay in high demand, and whose companies grow, without regard to the business cycle are called A) emerging industries. B) defense industries. C) cycling industries. D) growth industries.

growth industries

The principles of demand-side theory were laid out in the 1936 book, The General Theory of Employment, Interest, and Money written by who? A) Milton Friedman B) John Keynes C) Adam Smith D) Arthur Laffer

john jeynes

A customer wishes to sell short 1,000 shares of ABC. Prior to executing the order, the registered representative must receive principal permission to execute the trade. have the customer pledge personal collateral to cover the sale. locate shares that can be lent to effect the sale. receive permission from the customer to borrow shares.

locate shares that can be lent to effect the sale.

Demand-side economics call on the federal government to do which of the following to encourage economic activity? A) Lower personal income tax rates B) Decrease regulation C) Increase tax rates D) Decrease government spending

lower personal income tax ccredits A demand-side approach would call for lower taxes on consumers and increased government spending. Little emphasis is placed on the regulatory burden.

Which of the following is an example of a company in a defensive industry? A) Centipede Equipment, a heavy equipment manufacturer B) Major Mills Grain Company, a grain and cereal producer C) National Motors, an automobile manufacturer D) Pan American Aircraft, an airplane producer

major mills grain company a grain and cereal producer

The economy appears to be moving into a strong expansion. Which of the following companies will likely benefit the most from this expansion? A) Hinckley Gold and Silver Corp. B) Old Bess Steel, Inc. C) Dino Oil and Gas, Co. D) Daisy Dairy Company

old bess steel, inc

A supply-side approach to fiscal policy will use all of these tools except A) decreasing government regulatory costs. B) personal income tax rebates. C) decreasing tax rates on business entities. D) providing tax credits to small business.

personal income tax rebates

Blaine Smith has owned XYZ stock for several years and believes it is time to take his profit and invest that money in another stock. He should sell XYZ to close. buy XYZ to close. sell XYZ to open. buy XYZ to open.

sell XYZ to close.

An investor with no existing positions in MMS stock sells 100 shares. This is a short bullish position. a long bullish position. a short bearish position. a long bearish position.

short bearish position

All of the following are bullish positions except long stock. long warrants. short stock. long calls.

short stock

Sparkly florescent earbuds made in the U.S. by Irksome, Inc., are suddenly popular in Asia. People from Canton to Calcutta are buying them in huge numbers. This is most likely to cause A) the trade deficit to decrease, or surplus to increase. B) no effect on the balance of trade. C) something, but the impact is unpredictable. D) the trade surplus to decrease, or deficit to increase .

the trade defecit to decrease, or surplus to increase

Your client is purchasing XYZ corporate bonds and wants to know when regular way settlement is. You should tell her trade date plus 2 business days. trade date plus 3 business days. trade date plus 1 business day. trade date.

trade date plus 2 business days

Isaac James has some call options in his account that he would like to exercise. He wants to know when the resulting purchase of the stock would settle. You would tell him trade date plus 2 business days. trade date plus 3 business days. trade date plus 1 business day. trade date.

trade date plus 2 business days.

Fiscal policy seeks to encourage or discourage economic activity through the A) use of government spending and taxation. B) use of government spending and interest rate controls. C) management of money supply and government spending. D) management of money supply and taxation.

use of govt spending Fiscal policy is the use of government spending and taxation to smooth out the business cycle. Interest rates and money supply are elements of monetary policy. LO 14.a