Midterm Test Essay

Review Test Submitting: Midterm Examination Part you


This midterm exam consist of 25 multiple choice questions and includes the material in Chapters 1 through 5. Question you

four out of 4 items

The flat-screen plasma TVs are selling extremely well. � The originators of this technology happen to be earning bigger profits. � What theory of income best demonstrates the overall performance of the sang screen makers? Answer

Selected Response:

innovation theory of earnings

Correct Response:

innovation theory of earnings

Question a couple of

5 out of 4 factors

The Saturn Corporation (once a label of GM) was permanently shut off 2009. � What proceeded to go wrong with Saturn? Response

Selected Answer:

Saturn sold automobiles below the prices of Honda or Toyota, earning a low 3% level of go back. Correct Response:

Saturn offered cars under the prices of Honda or Toyota, generating a low 3% rate of return.

Problem 3

4 away of 4 points

Economic profit is described as the difference between revenue and ____. Answer

Selected Answer:

total economic price

Correct Response:

total economic cost

Problem 4

4 away of 5 points

The principal objective of any for-profit organization is to ___________. Answer

Selected Answer:

maximize aktionar value

Appropriate Answer:

maximize shareholder worth

Question five

four out of 4 points

Which of the following raises (V0), the shareholder prosperity maximization model of the firm: V0∙(shares outstanding) = Σ∞t=1 (π capital t ) / (1+ke)t � + Real Option Value. Answer

Chosen Answer:

Decrease the required charge of returning (ke).

Appropriate Answer:

Decrease the required charge of return (ke).

Query 6

0 away of some points

The moral danger in staff production arises from


Selected Response:

lack of correct assignment of individual duties

Correct Response:

a conflict between tactically best interest and one's responsibility

Question several

5 out of 4 points

Generally, buyers expect that projects with high predicted net present values will also be assignments with Response

Chosen Answer:


Correct Solution:

high risk

Issue 8

4 out of 4 points

The approximate possibility of a benefit occurring that may be greater than 1 standard deviation from the suggest is approximately (assuming a normal distribution) Answer

Selected Response:

15. ??????

Correct Answer:

15. 87%

Question being unfaithful

some out of 4 details

The ____ is the proportion of ____ to the ____.


Selected Response:

coefficient of variation; normal deviation; expected value Right Answer:

coefficient of variant; standard deviation; expected worth

Question 12

some out of 4 points

The level of a fiscal activity must be increased until the ____ is no. Answer

Selected Solution:

net little benefit

Appropriate Answer:

net marginal advantage

Question 14

5 out of 4 points

A change in the level of an economic activity is desirable and should be undertaken as long as the marginal rewards exceed the ____. Solution

Picked Answer:

marginal costs

Accurate Answer:

limited costs

Query 12

4 out of 5 points

The normal deviation is appropriate to review the risk among two investments only if Response

Picked Answer:

the expected results from the investments are about equal Right Answer:

the expected comes back from the purchases are around equal

Issue 13

4 away of four points

Songwriters and composers press music companies to reduce the price for music downloads since Answer

Selected Response:

songwriter royalties are a percentage of revenue revenue

Accurate Answer:

songwriter royalties are a percentage of sales earnings

Question 14

4 out of 4 points...