单选题An analyst makes the appropriate adjustments to the financial statements of retail companies that are lessees using a substantial number of operating leases. Compared to ratios computed from the unadjusted statements, the ratios computed from the adjusted statements would most likely be higher for: A. the debt-equity ratio but not the interest coverage ratio. B. the interest coverage ratio but not the debt-equity ratio. C. both the debt-equity ratio and the interest coverage ratio.

单选题Portfolio A earned an annual return of 15 percent with a standard deviation of 28 percent. If the mean return on Treasury bills ( T - bills) is 4 percent, the Sharpe ratio for the portfolio is : A. 0.54. B. 0.39. C. 1.87.

单选题Management of LLW Cabinetry, Inc., is considering leasing a new saw that will greatly increase the plant's throughput. Information on the machine and the terms of the lease are as follows: The machine has a fair market value of $ 2. 8 million, an estimated useful life of ten years, and no salvage value. Company incremental borrowing rate is 11.5%. Lease term of seven years with lease payments of $ 41567 due at the beginning of each month. Implicit lease rate is 10.0%. The lease does not contain a bargain purchase option, and there is no title transfer at the end of the lease. If management leases the machine (Note : carry calculations to at least three decimal places) : A. the current ratio is unaffected (all else equal). B. the lease period is greater than 75% of the asset' s useful life. C. in the first month, cash flow from operations will decrease by approximately $ 21039.

单选题For the year ended December 31,2007, Milan Company reported the following financial information : Gross profit from sales 600000 Operating expenses 100000 Unrealized loss from foreign currency translation 30000 Dividends received from available-for-sale securities 15000 Increase in minimum pension liability 45000 Interest expense 25000 Acquired treasury stock for $ 25000 more than original book value 75000 Unrealized gain from available-sale-securities 20000 Ignoring taxes, calculate Milan' s net income and comprehensive income for 2007. Net income Comprehensive income ①A. $ 490000 $ 435000 ②B. $ 490000 $ 2000 ③C. $ 40000 $ 44000 A. ① B. ② C.③

单选题The owner of a company has recently decided to raise the salary of one employee, who was already making the highest salary in the company, by 40 percent. Which of the following value (s) is (are) expected to be affected by this raise? A. median only. B. mean and median only. C. mean only.

单选题Which of the following is least likely to affect the elasticity of supply for a good? A. The time frame for making the supply decision. B. The uniqueness of production inputs. C. The relative amount of income spent on the good.

单选题An analyst gathered the following financial data about a company (in million dollars): market value $45 sales $600 earnings -$18 book value $27 What is the P/BV ratio for the company? A. 0.42 B. 1.67 C. 2.32

单选题Which of the following is NOT an implication of risk aversion for the investment process? A. The security market line is upward sloping. B. The promised yield on AAA-rated bonds is higher than on A-rated bonds. C. Investors expect a positive relationship between expected return and expected risk.

单选题In perfectly competitive industries, what is the most likely long-run effect of a permanent decrease in demand?

单选题A stock priced at $10 has a 60 percent probability of moving up and a 40 percent probability of moving down. If it moves up, it increases by a factor of 1.06. If it moves down, it decreases by a factor of 1/1.06. What is the expected stock price after two successive periods? A. $10.03. B. $11.24. C. $10.27.

单选题An analyst does research about price multiples. Which of the following statements is least accurate to explain using the price-to-sales ratio in equity valuation is better than the price-to-earnings ratio? A. Sales are more stable than earnings. B. Earnings are sometimes negative. C. Sales are the main driver of equity value.

单选题The minimum value for a European call option is:

单选题A companys optimal capital budget most likely occurs at the intersection of the:

单选题Ken Wallace is interested in testing whether the average price to earnings (P/E) of firms in the retail industry is 25. Using a t - distributed test statistic and a 5% level of significance, the critical values for a sample of 40 firms is/are:

单选题An analyst gathered the following annual data for SMG Corporation on 2004: Net profit margin 5% Total asset turnover 2.0% Total assets to equity 2.5% Net income $25000000 Dividends paid on common stock $10000000 The SMG Corporation"s estimated dividend growth rate is closest to:

单选题In the long run, when the economy is at full employment, will a decrease in the quantity of money due to restrictive monetary policy that brings a decrease in aggregate demand likely result in: the price level? real GDP? ①A. No No ②B. No Yes ③C. Yes No

单选题Which of the following is the most appropriate strategy for a fixed income portfolio manager under the anticipation of an economic expansion? A. Purchase corporate bonds and sell treasury bonds. B. Sell corporate bonds and purchase treasury bonds. C. Enter a pay-fixed, receive-floating rate swap.

单选题Equity return series are best described as, for the most part:

单选题Joanna, CFA, manages several pension accounts and directs most of her trades through the Torrenia Brokerage House. Joanna does this because she believes she gets expedient and low-cost trade execution, and Torrenia provides her with excellent research reports used in the management of these accounts. ZNS, a small brokerage house, has just approached Joanna and said it will execute her trades at half the cost of Torrenia. However, ZNS does not have a research department. If Joanna declines to switch her business to ZNS, has she violated any CFA Institute Standards? A. Yes, because she has not obtained explicit permission from her clients to use ZNS. B. Yes, because Standard Ⅲ (A) Loyalty, Prudence and Care states that she must minimize trade expenses. C. No, if the higher commissions are commensurate with the value of the research service she receives.

单选题Given the following inventory information about the Buckner Company: Year-end LIFO inventory of $ 6500. Year-end LIFO reserve of $ 2500. The current year' s LIFO cost of goods sold is $15000. After tax income is $1600. The previous year's LIFO reserve was $ 2000. What is the firm' s after tax net income on a FIFO basis if the firm' s tax rate is 40 percent?