The over the counter (OTC) market is

1. The over the counter (OTC) market is
a. Tangible market for unlisted securities
b. A place where securities are bought and sold
c. The New Your Stock Exchange
d. An organized stock exchange

2. The two key financial markets are
a. Primary market and secondary market
b. Capital market and secondary market
c. Primary market and money market
d. Money market and capital market

3. Securities exchanges create efficient markets that d do all of the following EXCEPT
a. Ensure a market in which the price reflect the true value of the security
b. Control the supply and demand for securities through price
c. Allocate funds to the most productive uses
d. Allow the price to be determined by supply and demand of securities

4. The tax deductibility of various expenses such as general and administrative expenses ______there after tax cost.
a. reduces
b. has no effect on
c. has an undermined effect on
d. increases

5. The dividend exclusion for corporations receiving dividends from another corporation has resulted in
a. Stock investments being relatively less attractive, relative to bond investment made by one corporation in another corporation
b. Stock investments being relatively more attractive relative to bond investments made by one corporation in another corporation
c. A lower cost of equity for the corporation paying the dividend
d. A higher relative cost of bond financing for the corporation paying the dividend

6. The rule setting body, which authorized generally accepted accounting principles is
a. FASB
b. Federal Reserve System
c. SEC
d. GAAP

7. Candy Corporation had pretax profits of $1.2 million, an average tax rate of 34 %, and it paid preferred stock dividends of $50,000. There were 100,000 share outstand and no interest expense. What were Candy Corporation s earnings per share?
a. $4.52
b. $7.59
c. $7.42
d. $3.91
8. The analyst should be careful when evaluating a ratio analyzes that
a. The dates of the financial stamen being compare are the same time
b. Pre audited states are used
c. neither A or B
d. Both A & B

9. The ______is useful in evaluating credit and collection policies.
a. Current asset turnover
b. Current ratio
c. Average collection period
d. Average payment period

10. The ________ratio may indicate poor collections procedure or lax credit policy.
a. Average collation period
b. Average payment period
c. Inventory turnover
d. Quick

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