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Sample Finance Quiz
1. The ______ is the annual rate of interest earned on a security purchased on a given date and held to maturity.
A. Term Structure
B. Yield Curve
C. Risk-free Rate
D. Yield to maturity
2. If a new asset is being considered as a replacement for an old asset, the relevant cash flows would be found by adding the expected cash flows attributed to old asset and the expected cash flows for new asset.
3. A firm with limited dollars available for capital expenditures is subject to
A. Capital Dependency
B. Working Capital Constraints
C. Capital Rationing
D. Mutually Exclusive Projects
4. The credit applicants ________ is its ability to repay the requested credit.
5. When managing accounts receivable, a good strategy to employ without losing future sales is to
A. Tighten the terms
B. Offer cash discounts
C. Send the accounts to a collection agency
D. Make frequent personal visits to the customer
6. The ______ rate of interest is typically the rate of return on a three-month U.S. Treasury bill.
D. Tax treatment risk
7. The risk premium consists of a number of components, including all of the following EXCEPT
A. Liquidity Risk
B. Default Risk
C. Inflationary Risk
D. Tax Treatment Risk
8. The _______ is the amount of time it takes the firm to recover its initial investment
A. Average rate of return
B. Internal rate of return
C. Payback period
D. Net present Value
9. The legal contract setting forth the terms and provisions of a corporate bond is a(n)
A. Promissory note
C. Loan Document
10. As an outstanding bond approaches maturity, the price of the bond will always trend toward par value until, at maturity, the bond is worth its face value.
11. The ______ is the discount rate that equates the present value of the cash inflows with the initial investment.
A. Average rate of return
B. Internal rate of return
C. Cost of capital
D. Payback period
12. If the required return is less than the coupon rate, a bond will sell at
A. A discount
C. Book Value
D. A premium
13. Sunk costs are cash outlays that have already been made and therefore have no effect on the cash flows relevant to the current decision. As a result, sunk costs should not be included in a projects incremental cash flows.
14. ______ yield curve reflects higher expected future rates of interest.
A. An upward-sloping
B. A flat
C. A linear
D. A downward-sloping
15. If a firm is subject to capital rationing, it is able to accept all independent projects that provide an acceptable return.
16. Bonds are
A. Long-term debt investments
B. A form of equity financing that pays interest.
C. A series of short-term debt instruments.
D. A hybrid form of financing used to raise large sums of money from a diverse group of lenders.
17. _______ is the process of evaluating and selecting long-term investments consistent with the firm's goal of owner wealth maximization.
A. Capital budgeting
B. Recapitalizing assets
C. Restructuring debt
D. Ratio Analysis
18. Mutually exclusive projects are those whose cash flows compete with one another; the acceptance of one does not eliminate the others from further consideration.
19. As credit standards are relaxed, sales are expected to ________ and the investment in accounts receivable is expected to _______.
A. Increase; Increase
B. Increase; Decrease
C. Decrease; Decrease
D. Decrease; Increase
20. The aggressive financing strategy is _______ method while the conservative financing strategy is _______ method.
A. A high-profit, high-risk; a low profit, low-risk
B. A low-profit, low-risk; a high-profit, high-risk
C. A low-profit, high-risk; a high-profit, low-risk
D. A high-profit, low-risk; a low-profit, high-risk
21. The _______ feature permits the issuer to repurchase bonds at a stated price prior to maturity.
22. The ABC Company has two bonds outstanding that are the same except for the maturity date. Bond D matures in 4 years, while Bond E matures in 7 years. If the required return changes by 15 percent
A. Bond E will have a greater change in price.
B. The price change for the bonds will be equal.
C. The price of the bonds will be constant.
D. Bond D will have a greater change in price.
23. If the payback period is less than the maximum acceptable payback period, we would accept a project.
24. One way to improve the cash conversion cycle is to
A. Borrow funds.
B. Slow down credit approvals.
C. Speed up collections.
D. Reduce inventory turnover.
25. Certain financing plans are termed conservative when
A. Short-term financing is used frequently.
B. Risk is increased.
C. Working capital is relatively high.
D. Working capital is relatively low.
26. The _______ is an inventory management technique that minimizes inventory investment by having materials inputs arrive at exactly the time they are needed for production.
A. ABC system
B. MRP system
C. JIT system
D. EOQ model
27. An aging schedule breaks down accounts receivable into groups on the basis of the first letter of the name of the company that owes on the account.
28. In the EOQ model, if carrying costs increase while all other costs remain unchanged, the number of orders placed would be expected to
A. Remain unchanged
C. Change without regard to carrying costs
29. 2/15 net 45 translates as
A. 15 percent cash discount if paid in 2 days, net 45-day credit period.
B. 45 percent of account due in 15 days, payment prior to day 15 receives a 2 percent discount.
C. 2 percent cash discount if paid prior to 15 days, if customer does not take a cash discount, the balance is due in 45 days.
D. 2 percent of the balance is due in 15 days, the remaining balance is due in 45 days.
30. A firm is evaluating a proposal which has an initial investment of $50,000 and has cash flows of $15,000 per year for five years. The payback period of the project is approximately:
a. 1.5 years
b. 2 years
c. 3.3 years
d. 4 years
31. What is the approximate yield to maturity for a $1000 par value bond selling for $1,120 that matures in 6 years and pays 12 percent interest annually?
a. 9.4 percent
b. 8.5 percent
c. 13.2 percent
d. 12.0 percent
32. A firm has an average age of inventory of 20 days, an average collection period of 30 days, and an average payment period of 60 days. The firm's cash conversion cycle is _____ days.
The solution explains various multiple choice questions relating to finance
Amino acids multiple choice questions
Which statement is incorrect about the classification of amino acids?
a. Alanine and valine are neutral, nonpolar amino acids.
b. Lysine and arginine are basic amino acids.
c. Tryptophan and phenylalanine are aromatic amino acids.
d. Aspartic acid and aspargine are acidic amino acids.
Which of the following amino acids is the least water soluble at pH 7.0?
b. Glutamic acid
Which amino acid would migrate the furthest toward the anode (positive electrode) during paper electrophoresis at pH 7.0?
a. Aspartic acid
Which of the following functional groups, attached to an inert matrix, could function as a cation exchanger?
Which of the following amino acids would make the best buffer at pH 4.5?
d. Aspartic acid
Which fact is incorrect about stereoisomers?
a. A diastereomer is a nonsuperimposable non-mirror image.
b. An enantiomer is a nonsuperimposible mirror image.
c. Diastereomers have different melting points.
d. Diastereomers rotate plane polarized light in equal but opposite direction.
Which statement is incorrect about L-isoleucine?
a. Its enantiomer is named O-isoleucine.
b. It contains a total of two asymmetric or chiral carbons.
c. It can also be named as (28, 38)-isoleucine using the (R,8) system.
d. Its diastereomer would be named O-alloisoleucine.
An isoelectric amino acid was dissolved in water and the resulting pH was approximately 7.6. What amino acid would possess this property?
b. Glutamic acid
What volume of NaOH is required to adjust the solution of monosodium aspartate to pH 9.8?
a. 1 ml
b. 2 ml
c. 3 ml
d. 6 ml or more
What volume of 2 N Hel is required to completely titrate the 4 mmol of monosodium aspartate?
a. 2 ml
d. 6 ml or more
Which statement is correct about the peptide ala-ser?
a. Alanine is at the N-terminal of the peptide.
b. There are a total six atoms that lie in the plane of the peptide bond linking alanine to serine.
c. The alpha-carbon of alanine is sp3 hybridized d All the above are correct statements.
What is the product formed from the acid hydrolysis of a simple amide?
a. Acid & base
b. Aldehyde & alcohol
c. Acid & amine
d. Ester & alcohol
The complete acid hydrolysis of the peptide ala-gln-trp-ser would yield:
a. Ala, gin, trp, ser
b. Ala, glu, ser
c. Ala, glu, trp, ser
d. Ala. ser
Fibrous proteins, such as collagen, have which of the following properties?
a. Highly soluble in water
b. Their hydrophilic residues are directed into the interior of the protein
c. Exhibit enzymatic activity
d. Serve structural roles in the cell
Quaternary structure is associated with:
a. The overall shape of a polypeptide chain
b. The sum of the secondary and tertiary interactions
c. Simple proteins with only one subunit
d. The relative orientation of one polypeptide to another polypeptide in a multi-subunit protein.
The information needed to define the structure of a protein is essentially contained in:
a. Amino acid composition
b. Amino acid sequence
c. Secondary structure
d. Tertiary structure.
Insulin is a polypeptide hormone that contains two short polypeptide chains linked by two interstrand disulfide bonds. The most logical order of events to perform in order to sequence this protein would be:
A: The peptides are reduced with mercaptoethanol.
B: The peptides are sequenced using Edman chemistry .
C: The peptides are separated by chromatography techniques. 0: The peptides are alkylated with iodoacetamide.
a. A, D,C, B b.C,A, 0, B
c. C, B, A, 0
d. A, B, C, 0
Which statement is incorrect about the peptide val-asp-trp-asn-ser?
a. This peptide would show a strong absorption band at 280 nm.
b. Reaction with chymotrypsin would yield two peptides.
c. To synthesize this peptide using the solid phase method of Merrifield, the amino acid directly attached to the resin would be serine.
d. After the second round of Edman chemistry using the reagent PITC, the PTH -amino acid residue released would be PTH-asn.
Which statement is incorrect about the reaction of the peptide ser-Iys-asp-trp-cys-metasn-phe-ala with the following reagents?
a. Reaction with cyanogens bromide would yield two peptides.
b. Reaction with trypsin would result in three peptides. The smallest of three peptides would have the highest pi of the three.
c. Reaciton with chymotrypsin would result in the peptides ser-Iys-asp & try-cys-met-Iysasn-phe-ala .
d. Reaction with chymotrypsin would yield a different set of peptides that overlap those obtained with tryspsin
Determine the amino acid sequence of the following oligopeptide from the experimental data below:
The amino acid composition is found the be ala, Iys, phe, met, cys plus some
2. The peptide has a molecular weight around 700 Da and absorbs at 280 nm.
3. Treatment with carboxypeptidase results in tryptophan and a peptide.
4. CNBr treatment yields a tetrapeptide and a dipeptide.
5. Trypsine digestion produces an amino acid and a pentapeptide with met on the amino end.
6. Chymotrypsin digestion yields a dipeptide and a tetrapeptide.
d. Iys-ala-cys-phe-met -trp