1 Which of the following exchanges has the strictest listing requirements? A AME

Question

1 Which of the following exchanges has the strictest listing requirements?
A AMEX
B OTC
C NYSE
D Nasdaq

2 Errors in capital budgeting decisions:
A tend to average out over time.
B are easily reversed.
C decrease the firm's value.
D are diminished because the time value of money makes future cash flows less important.

3 Which of the following factors is least important to capital budgeting decisions.?
A The time value of money
B Cash flows directly resulting from the decision
C The risk-return tradeoff
D Net income based on accrual accounting principles

4 Good capital investment opportunities are most likely to exist when:
A interest rates are high and rising.
B a line of business is expensive to enter and uses proprietary technology.
C many firms compete to sell similar products.
D goods and services can be produced cheaply using readily available tools and technologies.

5 Central Mass Ambulance Service can purchase a new ambulance for $200,000 that will provide an annual net cash flow of $50,000 per year for five years. Calculate the NPV of the ambulance if the required rate of return is 9%. (Round your answer to the nearest $1.)
A $50,000
B $(5,517)
C $(5,061)
D $5,517

Explanation / Answer

C NYSE C decrease the firm's value. B Cash flows directly resulting from the decision C many firms compete to sell similar products. B $(5,517)

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