Exam (elaborations)
Finc 300 Test 1 Questions And Answers Latest Update
- Course
- FINC 300
- Institution
- American Military University
Finc 300 Test 1 Questions And Answers Latest Update
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Solution 2024/2025Pepper
Finc 300 Test 1 Questions And Answers Latest
Update
Sole Proprietorship ANS✔✔ a business owned and managed by a single
individual; has unlimited liability
Partnership ANS✔✔ two or more owners; unlimited liability
Corporation ANS✔✔ a legal "person" separate and distinct from its
owners;separation of owners and managers; limited liability; generates
income, it pays corporate tax
The objective of management is ANS✔✔ to maximize stock price
Sarbanes-Oxley Act ANS✔✔ To insure the accuracy and fair reporting of
these financial statements, laws like the ______________ were enacted to
counter fraudulent reporting.
Agency Problems ANS✔✔ conflicts of interest between managers and
stockholders
Agency Relationship ANS✔✔ The relationship between stockholders and
management
Financial Market ANS✔✔ where stocks and bonds are issued, securities are
traded, and prices for securities are established
, Solution 2024/2025
Pepper
Spot markets ANS✔✔ markets for immediate delivery
Future markets ANS✔✔ Markets in which participants agree today to buy or
sell an asset at some future date.
Money Markets ANS✔✔ Include short-term, highly liquid, and relatively low-
risk debt instruments; usually less than 1 year
Capital Markets ANS✔✔ stocks and bonds, greater than 1 year
Examples of money market ANS✔✔ treasury bills, commercial paper,
certificates of deposits
Primary Markets ANS✔✔ refers to the original sale of securities by
governments and corporations. The corporations are the seller, the
transactions raise money for the corporations.
Public offering ANS✔✔ selling securities to general public
Private placements ANS✔✔ negotiated sale involving a specific buyer
Secondary markets ANS✔✔ are those in which these securities are bought
and sold after the original sale. Involves the owner or creditor selling to
another; provides the means for transferring ownership to corporate
securities.
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