单选题Which statement regarding sinking funds is least likely correct? A. If rates have declined since the bond was issued, companies are likely to choose to retire a proportion of the debt through the delivery of securities. B. Sinking fund redemptions can be accomplished by making cash payment to the trustee who will then retire the applicable proportion of the bonds. C. The right to retire a greater portion of the bond issue than is stipulated in the indenture is called an "accelerated sinking fund provision".
单选题Which of the following actions is a required, rather than recommended,
action under the Standard regarding diligence and a reasonable basis for a
firm's research recommendation?
A. Have a policy requiring that research reports and recommendations have a
basis that can be substantiated as a reasonable and adequate.
B. Compensate analysts based on measurable criteria to assess the quality of
their research.
C. Review the assumptions used and evaluate the objectivity of externally
generated research reports.
单选题For the common stock of a firm that reported a small loss for the year just ended, the price multiple that is least likely to be meaningful is:
单选题If a government increases its spending on domestically produced goods by an amount that is financed by the same increase in taxes, the aggregate demand will most likely:
单选题When incomes in foreign countries increase, aggregate demand in the U.S. is likely to:
单选题Which of the following conditions is most likely to exist for a
typical production process when average product is at its maximum?
A. Marginal product is increasing.
B. Marginal product is at a minimum.
C. Average variable cost is at a minimum.
单选题Which of the following statements is FALSE?
单选题Steven Brockman, CFA, is a sell-side analyst. Approximately half of Brockman's compensation comes form his firm's investment-banking division. Brockman is asked to write a report about Anacortes Concrete (AC) , an investment-banking client. Despite his concerns about a slowdown in concrete demand, Brockman issues a very positive report on AC. When issuing his report, Brockman least likely violates the CFA Institute Standard relating to:
单选题When GIPS and local laws conflict, in order to be in compliance with
GIPS, the investment firm must:
A. follow GIPS and need not reference the local law.
B. follow GIPS but disclose that this is in conflict with local laws.
C. follow local law but disclose the conflict with GIPS.
单选题Insider trading can be defined as information that is:
单选题The short in a deliverable forward contract:
A. makes a cash payment to the long at settlement.
B. receives a payment at contract initiation.
C. is obligated to deliver the specified asset.
单选题On January 2, a company acquires some state-of-the-art production equipment at a net cost of $14 million. For financial reporting purposes, the firm will depreciate the equipment over a 7-year life using straight-line depreciation and a zero salvage value; for tax reporting purposes, however, the firm will use 3-year accelerated depreciation. Given a tax rate of 35% and a first year accelerated depreciation factor of 0.333, by how much will the company's deferred tax account increase in the first year of the equipment's life?
单选题Stolzenbach Technologies has a target capital structure of 60 percent
equity and 40 percent debt. The schedule of financing costs for the Stolzenbach
is shown in the table below:
{{U}}Amount of New Debt (in millions){{/U}}
{{U}}After-tax Cost of Debt{{/U}}
{{U}}Amount of New Equity (in millions){{/U}}
{{U}}Cost of Equity{{/U}}
$0 to $199
4.5 percent
$0 to $299
7.5 percent
$200 to $399
5.0 percent
$300 to $699
8.5 percent
$400 to $599
5.5 percent
$700 to $999
9.5 percent
Stolzenbach Technologies has breakpoints for raising additional financing at
both:
A. $500 million and $1000 million.
B. $400 million and $700 million.
C. $500 million and $700 million.
单选题Which one of the following structures is characterized by free entry and exit, a differentiated product, and price searcher behavior?
单选题The financial manager at IBFM, a farm implement distributor, is contemplating the following three mutually exclusive projects. IBFM's required rate of return is 9.5 percent. Based on the information provided, which should the financial manager select and why?
Project
Investment at t=0
Cash Flow at t=1
IRR
NPV @ 9 5 percent
A
$10000
$11300
13.00
$320
B
$25000
$29000
16.00
$1484
C
$35000
$40250
15.00
$1758 A. Project A with the lowest initial investment. B. Project B with the highest internal rate of return. C. Project C with the highest net present value.
单选题Advantages related to investments in mutual funds include all of the following except? A. Mutual funds provide an investor with asset diversification as well as consistent risk-return preferences. B. Mutual funds allow the investor to shift between alternative investment instruments easily while maintaining good records, dividend reinvestment and timely information for tax purposes. C. Mutual funds provide investors with superior risk-adjusted returns.
单选题Thomas Turkman recently hired Georgia Viggen, CFA, as a portfolio manager for North South Bank
单选题A firm's demand for labor most likely decreases if: A. the price of the firm's output increases. B. marginal product of labor increases. C. the price of a complement of labor increases.
单选题Which of the following is most likely a limitation of the yield-to-maturity measure?
单选题Valuation of a swap during its life will leastlikely involve the: