The trait approach is criticized for its failure to take __________ into consideration.
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Correct Answer:
Situations
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____ is when the home is financially and legally transferred to the new owner.
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Correct Answer:
Closing
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____ fee is (are) common miscellaneous costs in buying a home.
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Correct Answer:
An appraisal
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With an inflation rate of 9 percent, prices would double in about ___________ years.
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Correct Answer:
8
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When corporate tax rates decline, the net cost of debt financing ________.
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Correct Answer:
Increases
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When an insured dies, any outstanding loan balance is ____ to determine the death benefit.
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Correct Answer:
subtracted from the face value
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When a stock price breaks through the moving average from below, this is considered to be ______.
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Correct Answer:
The starting point for a new moving average
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We can estimate a stock's value by__________.
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Correct Answer:
Compounding the past dividends and past stock price appreciation
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Value stocks usually exhibit ______ price-to-book ratios and ______ price-to-earnings ratios.
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Correct Answer:
Low; low
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Value stocks are more likely to have a peg ratio _____.
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Correct Answer:
Less than one
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Underwriting is one of the services provided by _____.
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Investment bankers
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The optimal capital structure is the one that balances ________.
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Correct Answer:
Return and risk factors in order to maximize firm's value.
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The only way for behavioral patterns to persist in prices is if ______________.
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Correct Answer:
There are limits to arbitrage activity
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The _________ is the difference between the actual call price and the intrinsic value.
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Correct Answer:
Time value
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Strikes, lawsuits, regulatory actions, or the loss of a key account are all examples of ________.
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Correct Answer:
Market risk
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Short-range forecasts tends to ________ longer-range forecasts.
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Correct Answer:
Be more accurate than
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Africans have comprised about ___ of all immigrants in the past few years.
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Correct Answer:
Less than 1%
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_______ is the primary delineator of cultural groups.
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Correct Answer:
Language
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If you were looking through a microscope at a normal sperm cell, you should see ____ chromosomes.
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Correct Answer:
23
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If an asset price declines, the investor with a _______ is exposed to the largest potential loss.
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Correct Answer:
Long futures contract
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If a stock is correctly priced, then you know that ____________.
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Correct Answer:
The sum of the stock's expected capital gain and dividend yield is equal to the stock's required rate of return
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An implication of the efficient market hypothesis is that __________.
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Correct Answer:
Nonzero beta will quickly disappear
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A hedge ratio of .70 implies that a hedged portfolio should consist of ________.
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Correct Answer:
Long 0.70 shares for each short call
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A firm's annual stockholders' report ________.
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Correct Answer:
Summarizes and documents the firm's financial activities during the past year
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A ________ is an exchange rate quoted today for settlement at some time in the future.
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Forward rate
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______________ occurs when a company is broken up into smaller divisions and sold for a profit.
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Liquidation
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______________ in interest rates are associated with stock market declines.
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Correct Answer:
Unanticipated increases
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The difference between a secured loan and an unsecured loan is _____.
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Correct Answer:
Secured loan requires a collateral and an unsecured loan does not.
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____ is a benefit of borrowing.
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Correct Answer:
All of these are benefits
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________ is the amount of money a company actually receives and spends over a specific period.
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Cash flow
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______ security refers to the borrower’s assurance to lenders that loans will be repaid.
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Correct Answer:
Loan
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Which of the following involves the sale of stock to a selected group of individuals where the stock cannot be purchased by the general public?
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Correct Answer:
Private placement
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Each year, Alexandra receives a payment for the stock she owns within the company where she is employed. The amount of the annual payment fluctuates based on the company’s net profits. This is referred to as ______.
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Correct Answer:
A dividend
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The general economic climate at the time of the loan application is which of the following five C’s of credit?
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Correct Answer:
Conditions
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______ refers to the intervals at which interest is paid.
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Correct Answer:
Compounding
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The two types of loan endorsers are ______.
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Correct Answer:
Guarantors and comakers
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A finance company will generally purchase the accounts receivable or lend small businesses somewhere between ______ percent of the face value of the accounts receivable being factored.
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Correct Answer:
55 and 80
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______ are made to small business owners based on the amount of money paid in premiums on an insurance policy that has a cash surrender value.
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Correct Answer:
Policy loans
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An insurance company will frequently lend up to ______ of a policy’s cash surrender value.
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Correct Answer:
95 percent
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Upon obtaining a $100,000 business loan from his local bank, Arthur was informed that he must keep at least $10,000 on deposit with the bank. This is referred to as a/an ______.
Answer
Correct Answer:
Compensating balance
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Loans that are granted by commercial banks to entrepreneurs that are then guaranteed at up to 90 percent of the loan value by the SBA as part of the 7(a) program are called which of the following?
Answer
Correct Answer:
Guaranteed loans
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The rate of interest charged to a bank’s “best” customers is referred to as ______.
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Correct Answer:
Prime rate
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The practice of raising funds for a business through the sale of accounts receivable is known as which of the following?
Answer
Correct Answer:
Factoring accounts receivable
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Wilma is ecstatic about the purchase of her first house. She has taken out a 30-year mortgage at a 5.25 percent interest rate, and her mortgage broker has informed her that the interest rate will not change for the life of the loan. What type of loan did Wilma take out?
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Correct Answer:
Fixed-rate loan
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A small business may qualify for loans through a commercial bank where a portion of the loan is guaranteed by the Small Business Administration. This loan is known as ______.
Answer
Correct Answer:
An SBA loan
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Principal is an amount of money borrowed from a _____.
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Correct Answer:
Lender
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A loan made to a business by an _____ using the business’s insurance policy as collateral.
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Correct Answer:
Insurance company
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Maturity is the length of time in which a loan must be repaid.
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Correct Answer:
True
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Long-term assets are the assets that will be converted into cash within _____.
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Correct Answer:
One year
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Long-term assets are the assets that will be converted into cash within one year.
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Correct Answer:
False
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Loan security is an assurance to a _____ that a loan will be repaid.
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Correct Answer:
Lender
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Line of credit is an agreement that makes a specific amount of _____ funding available to a business as it is needed.
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Correct Answer:
Short-term
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Leverage is the ability to finance an investment through _____.
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Correct Answer:
All of the above
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Interest rate is the amount of money paid for the use of borrowed funds.
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Correct Answer:
True
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Installment loans is a loan made to a business for the purchase of fixed assets such as ?
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Correct Answer:
All of these
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The first sale of stock of a business made available to private investors is known as Initial public offering.
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Correct Answer:
False
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Floor planning is a type of business loan generally made for _____ items.
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Correct Answer:
“Big-ticket”
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Fixed rate loan is a loan whose interest rate remains _____.
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Correct Answer:
Constant
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Factoring is the practice of raising funds for a business through the sale of accounts receivable.
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Correct Answer:
True
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Equity financing is the sale of common stock or the use of retained earnings to provide _____ financing.
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Correct Answer:
Long-term
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_____ is the sale of common stock or the use of retained earnings to provide long-term financing.
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Correct Answer:
Equity Financing
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Payments based on the _____ of the business and made to the providers of equity capital are known as Dividends.
Answer
Correct Answer:
Net profits
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Demand note is a _____ loan that must be repaid in a lump sum at maturity.
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Correct Answer:
Short-term
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The use of borrowed funds to finance a business is called?
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Correct Answer:
Debt Financing
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Certified development company is a profit organization sponsored either by private interests or by state or local governments.
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Correct Answer:
False
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Balloon note is a loan that requires the borrower to make _____ payments with the balance of the loan due at maturity.
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Correct Answer:
Small monthly
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_____ is a loan that requires the borrower to make small monthly payments with the balance of the loan due at maturity.
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Correct Answer:
Balloon note
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Angel is a _____ who loans money to help new businesses.
Answer
Correct Answer:
All of these
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