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Questions
Q:
In ________ markets, participants post bid and ask prices at which they are willing to trade, but orders are not automatically executed by computer. ____________ execute trades for people other than themselves, and in _______________ markets a computer matches orders with an existing limit order book and executes the trades automatically.
A. electronic; Dealers; brokers
B. dealer; Brokers; electronic
C. direct search; Brokers; electronic
D. brokered; Dealers; direct search
Q:
Peyton Corporation owns an 80% interest in Sampe Corporation's common stock. Throughout 2011, Sampe had 10,000 shares of common stock outstanding and Peyton had 100,000 shares of common stock outstanding. Sampe's only dilutive security consists of $100,000 face amount of 8% bonds payable. Each $1,000 bond is convertible into 20 shares of Sampe stock. Peyton and Sampe's separate net incomes for the year are $200,000 and $150,000, respectively. Assume a 34% flat income tax rate.
Required:
Compute the amount of basic and diluted earnings per share for Peyton (consolidated) and Sampe Corporations.
Q:
Which of the following would NOT be a short-run decision for the firm?
A) Recall workers who were previously laid-off
B) Have labor work two hours overtime each day in order to expand output
C) Build another wing on the plant in order to add a new assembly line
D) Place an order with a supplier for additional raw materials
Q:
The largest nongovernmental regulator of securities firms in the United States is ________.
A. the CFA Institute
B. the Public Company Accounting Oversight Board
C. the Financial Industry Regulatory Authority
D. the Board of Directors of NYSE Euronext
Q:
Parker Corporation owns an 80% interest in Sample Corporation's common stock. Throughout 2010, Sample had 10,000 shares of common stock outstanding and Parker had 100,000 shares of common stock outstanding. Sample's only dilutive security consists of $50,000 face amount of 8% bonds payable. Each $1,000 bond is convertible into 20 shares of Sample stock. Parker and Sample's separate incomes for the year are $100,000 and $75,000, respectively. Assume a 34% flat income tax rate.
Required:
Compute the amount of basic and diluted earnings per share for Parker (Consolidated) and Sample Corporations.
Q:
Pandy Corporation owns a 90% interest in Sakaj Corporation's common stock. Throughout 2010, Sakaj had 20,000 shares of common stock outstanding and Pandy had 50,000 shares of common stock outstanding. Sakaj's only dilutive security consists of 10,000 stock options, with an exercise price of $20 per share. The average price of Sakaj's stock is $50 per share in 2010. The options are exercisable for one share of Sakaj's common stock. Pandy's and Sakaj's separate net incomes for the year are $200,000 and $180,000, respectively.
Required:
Compute the amount of basic and diluted earnings per share for Pandy (Consolidated) and Sakaj Corporations.
Q:
The concept of limited liabilityA) does not apply to a corporation.B) means that the owners of a corporation have liability limited to the value of the shares in the firm.C) means that owners of a firm are subject to double taxation.D) limits the amount of specialization that can occur in a firm.
Q:
Which of the following are true concerning short sales of exchange-listed stocks?
I. Proceeds from the short sale must be kept on deposit with the broker.
II. Short-sellers must post margin with their broker to cover potential losses on the position.
III. The short-seller earns interest on any cash deposited with the broker that is used to meet the margin requirement.
A. I only
B. I and III only
C. I and II only
D. I, II, and III
Q:
Pancino Corporation owns a 90% interest in Sakal Corporation's common stock. Throughout 2010, Sakal had 20,000 shares of common stock outstanding and Pancino had 50,000 shares of common stock outstanding. Sakal's only dilutive security consists of 2,500 stock options, with an exercise price of $20 per share. The average price of Sakal's stock is $50 per share in 2010. The options are exercisable for one share of Sakal's common stock. Pancino's and Sakal's separate net incomes for the year are $100,000 and $80,000, respectively.
Required:
Compute the amount of basic and diluted earnings per share for Pancino (Consolidated) and Sakal Corporations.
Q:
The slope of the budget line isA) zero since prices of the goods and income are assumed to be constant.B) negative since to purchase more of one good means that some of the other good must be given up.C) negative because of the marginal rate of substitution. D) positive since prices and income are positive.
Q:
Maintenance requirements for margin accounts are set by ____.
A. brokerage firms
B. the SEC
C. the Federal Reserve System's Board of Governors
D. the Supreme Court
Q:
Savy Corporation's stockholders' equity on December 31, 2010 was as follows:
8% cumulative preferred stock, $100 par value,
callable at $109, with two years of dividends
in arrears $100,000
Common stock, $25 par value 700,000
Additional paid-in capital 250,000
Retained earnings 400,000
Total stockholders' equity $1,450,000
On January 1, 2011, Paul Corporation purchased a 70% interest in Savy's common stock for $2,100,000. On this date the book values of Savy's assets and liabilities are equal to their fair values.
Required:
1. Determine the book value of the common stockholders' equity for Savy Corporation on January 1, 2011.
2. What is the amount of goodwill reported on the consolidated balance sheet for Paul Corporation and Subsidiary at January 2, 2011?
3. On January 2, 2011, Paul purchased 70% of Savy's preferred stock for $50,000. Prepare the journal entry(ies) for Paul for this purchase on January 2, 2011.
4. Prepare the elimination entry on the consolidating work papers for the Investment in Savy, Preferred Stock and Savy's Preferred Stock on January 2, 2011.
Q:
Which of the following is NOT consistent with the law of diminishing marginal utility?A) Newspaper vending machines are not as secure as soft drink machines.B) A student selects to eat at an all -you-can-eat restaurant rather than at a restaurant that charges for refills.C) A studentʹs enjoyment of opera increases the more she listens to it.D) A symphony has free throat lozenges in their lobby.
Q:
The SIPC was established by the ____.
A. Insider Trading Act of 1931
B. Securities Act of 1933
C. Securities Exchange Act of 1934
D. none of these options
Q:
Samford Corporation's stockholders' equity on December 31, 2010 was as follows:
8% cumulative preferred stock, $100 par value,
callable at $109, with two years of dividends
in arrears $100,000
Common stock, $25 par value 700,000
Additional paid-in capital 250,000
Retained earnings 400,000
Total stockholders' equity $1,450,000
On January 1, 2011, Panera Corporation purchased a 70% interest in Samford's common stock for $1,400,000. On this date the book values of Samford's assets and liabilities are equal to their fair values.
Required:
1. Determine the book value of the common stockholders' equity for Samford Corporation on January 1, 2011.
2. What is the amount of goodwill reported on the consolidated balance sheet for Panera Corporation and Subsidiary at January 2, 2011?
3. What is the noncontrolling interest that appeared on a consolidated balance sheet for Panera Corporation and Subsidiary on January 2, 2011?
Q:
Robert must always have cream in his coffee. For Robert, the cross price elasticity of demand for coffee and cream isA) equal to 0. B) negative. C) positive.D) impossible to determine without more information.
Q:
The ____ requires full disclosure of relevant information relating to the issue of new securities.
A. Insider Trading Act of 1931
B. Securities Act of 1933
C. Securities Exchange Act of 1934
D. Investment Company Act of 1940
Q:
Sally Corporation's stockholders' equity on December 31, 2010 was as follows:
10% cumulative preferred stock, $100 par value,
callable at $105, with one year dividends in arrears $10,000
Common stock, $1 par value 50,000
Additional paid-in capital 150,000
Retained earnings 160,000
Total stockholders' equity $370,000
On January 1, 2011, Panera Corporation paid $500,000 for a 70% interest in Sally's common stock. On January 1, 2011, the book values of Sally's assets and liabilities were equal to fair values.
Required:
1. Determine the book value of the common stockholders' equity for Sally Corporation on January 1, 2011.
2. What is the amount of goodwill reported on the consolidated balance sheet for Panera Corporation and Subsidiary at January 2, 2011?
3. On January 2, 2011, Panera purchased 70% of Sally's preferred stock for $5,000. Prepare the journal entry(ies) for Panera for this purchase on January 2, 2011.
4. Prepare the elimination entry on the consolidating work papers for the Investment in Sally, Preferred Stock and Sally's Preferred Stock on January 2, 2011.
Q:
The value of the absolute price elasticity of demand for good X is 4. The absolute price elasticity for good Y is 1. Which goodʹs quantity demanded is less responsive to a change in price?A) Good X. B) Good Y.C) They are equally responsive. D) Not enough information is given.
Q:
Trading on inside information is:
I. Prohibited by federal law
II. Prohibited by the CFA Institute Standards of Professional Conduct
III. Monitored by the SEC
A. I and II only
B. II and III only
C. I and III only
D. I, II, and III
Q:
Saito Corporation's stockholders' equity on December 31, 2010 was as follows:
10% cumulative preferred stock, $100 par value,
callable at $105, with one year dividends in arrears $10,000
Common stock, $1 par value 50,000
Additional paid-in capital 150,000
Retained earnings 160,000
Total stockholders' equity $370,000
On January 1, 2011, Panata Corporation paid $300,000 for a 70% interest in Saito's common stock. On January 1, 2011, the book values of Saito's assets and liabilities were equal to fair values.
Required:
1. Determine the book value of the common stockholders' equity for Saito Corporation on January 1, 2011.
2. What is the amount of goodwill reported on the consolidated balance sheet for Panata Corporation (and Subsidiary) at January 2, 2011?
3. What is the noncontrolling interest that appeared on a consolidated balance sheet for Panata Corporation (and Subsidiary) on January 2, 2011?
Q:
Quantity of Clean Air (%)Marginal Cost ($)Marginal Benefit ($)010,000100,0002525,00050,0005037,50037,5007575,00025,000100Infinite0In the above table, the optimal quantity of clean air isA) 25 percent. B) 50 percent. C) 75 percent. D) 100 percent.
Q:
The CFA Institute Standards of Professional Conduct require that members _____.
A. place their clients' interests before their own
B. disclose conflicts of interest to clients
C. inform their employers that they are obligated to comply with the Standards of Professional Conduct
D. all of these options
Q:
Palomba Corporation allocates consolidated income taxes to its 90%-owned subsidiary using the percentage allocation method. Under this method, consolidated income tax expense will be allocated to a subsidiary
A) on the basis of the agreement between the parent and subsidiary.
B) on the basis of the subsidiary's pretax income as a percentage of consolidated pretax income.
C) on the basis of the income taxes remitted to the IRS.
D) 90% to the subsidiary.
Q:
All of the following aim to reduce income inequality EXCEPTA) Social Security payments. B) earned income tax credits. C) regressive taxes. D) food stamp programs.
Q:
The average depth of the limit order book is _____.
A. lower for the large stocks in the S&P 500 Index than for the smaller stocks in the Russell 2000 Index
B. higher for the large stocks in the S&P 500 Index than for the smaller stocks in the Russell 2000 Index
C. about the same for both the large stocks in the S&P 500 Index and the smaller stocks in the Russell 2000 Index
D. unrelated to the sizes of the stocks in the indexes
Q:
Palmquist Corporation and its 80%-owned subsidiary, Sadler Corporation, are members of an affiliated group. They do not file consolidated tax returns. Sadler had $3,000,000 of income and paid $1,000,000 dividends in 2010. Palmquist and Sadler had 35% income tax rates. What amount of Sadler's dividends is taxable to Palmquist in 2010?
A) $0
B) $ 70,000
C) $160,000
D) $200,000
Q:
In the above figure, what is the wage rate the monopsonist will pay?A) W1 B) W2 C) W3 D) W4
Q:
If an investor uses the full amount of margin available, the equity in a margin account used for a stock purchase can be found as
________.
A. market value of the stock - amount owed on the margin loan
B. market value of the stock + amount owed on the margin loan
C. market value of the stock margin loan
D. margin loan market value of the stock
Q:
Prior to World War I, the U.S. governmentʹs attitude towards labor unions was one ofA) indifference.B) support. C) hostility.D) support, except when it came to unions of public employees.
Q:
Palmer Company owns a 25% interest in Sad, Incorporated, a domestic company. Sad had net income of $60,000 and paid dividends of $20,000. Palmer's tax rate is 35%. For simplicity, assume that Sad's undistributed earnings are Palmer's only temporary timing difference. Assume Sad qualifies for the 80% dividend received deduction. Which of the following statements is correct?
A) The current tax liability is $700.
B) The current tax liability is $1,050.
C) Under GAAP, Palmer provides for income taxes on Sad's undistributed earnings with a credit to deferred tax liability of $700.
D) Under GAAP, Palmer provides for income taxes on Sad's undistributed earnings with a credit to deferred tax liability of $1,050.
Q:
You hold 5,000 shares of the 1 million outstanding shares of Wealthy Wranglers common stock. You've just learned that the company plans to issue more shares, so that 2 million shares will be outstanding. This is called _____.
A. an advanced equity offering
B. a weathered equity offering
C. a seasoned equity offering
D. a veteran equity offering
Q:
Palm owns a 70% interest in Sable, a domestic subsidiary. Sable is not part of Palm's affiliated group. Palm will pay taxes on
A) none of the dividends it receives from Sable.
B) 20% of the dividends it receives from Sable.
C) 66% of the dividends it receives from Sable.
D) 80% of the dividends it receives from Sable.
Q:
In the long run, input demand becomes moreA) elastic. B) inelastic. C) unit-elastic. D) cost efficient.
Q:
In 2008, the NASDAQ stock market merged with _____.
A. Euronext
B. OMX, which operates seven Nordic and Baltic stock exchanges
C. the International Securities Exchange (ISE)
D. BATS
Q:
All major stock markets today are effectively _______________.
A. specialist trading systems
B. electronic trading systems
C. continuous auction markets
D. direct search markets
Q:
When a subsidiary has preferred stock that is convertible into subsidiary common stock, the parent's equity in the subsidiary's diluted earnings is calculated by the number of
A) subsidiary shares into which the subsidiary's dilutive securities can be converted times the subsidiary's basic EPS figure.
B) parent shares into which the subsidiary's dilutive securities can be converted times the parent's basic EPS figure.
C) subsidiary common shares held by the parent times the subsidiary's diluted EPS figure.
D) parent shares into which the subsidiary's dilutive securities can be converted times the subsidiary's basic EPS figure.
Q:
The first antitrust law in the United States was theA) FTC Act. B) Clayton Act.C) Sherman Act. D) Robinson-Patman Act.
Q:
In computing consolidated diluted EPS, the replacement calculation replaces the parent's equity in subsidiary earnings with the
A) parent's share of basic EPS of the subsidiary.
B) subsidiary's share of basic EPS of the parent.
C) parent's share of diluted EPS of the subsidiary.
D) subsidiary's share of diluted EPS of the parent.
Q:
A given industry, Z, is such that the 1 -firm, 2-firm, 4-firm and 8-firm concentration ratios are the same. Based on this, we can conclude that Industry Z isA) pure competition. B) monopolistic competition. C) oligopoly. D) pure monopoly.
Q:
Regulation NMS:
I. Supports the goal of integrating financial markets II. II. Requires the use of specialists to execute trades
III. Requires that exchanges honor quotes of other exchanges when they can be executed automatically
A. I only
B. I and II only
C. I and III only
D. I, II, and III
Q:
Parnaby has 25,000 common stock shares outstanding and its 100%-owned subsidiary Sandal has 5,000 common stock shares outstanding. Parnaby and Sandal do not have any potentially dilutive securities outstanding. The separate net incomes for Parnaby and Sandal is $150,000 and $75,000 respectively. Diluted EPS for the consolidated company is
A) $5.00.
B) $6.00.
C) $7.50.
D) $9.00.
Q:
A horizontal merger involvesA) the joining of two firms at different stages of the production process.B) the separation of management from ownership. C) the joining of two firms selling similar products.D) the exchange of debt for stock.
Q:
If a parent company has controlling interest in a subsidiary which has no potentially dilutive securities outstanding, then in the calculation of consolidated diluted EPS, it will be necessary to
A) only make an adjustment of subsidiary's basic earnings.
B) replace the parent's equity in subsidiary earnings with the parent's equity in subsidiary's diluted EPS.
C) make a replacement calculation in the parent's basic earnings for the EPS.
D) only use the parent's common shares and shares represented by the parent's potentially dilutive securities.
Q:
The market share held by the NYSE Arca system in February 2011 was approximately ____.
A. 65%
B. 45%
C. 25%
D. 10%
Q:
In the above figure, the profit-maximizing monopolistically competitive firm will A) make a profit of $24,000. B) make a profit of $30,000. C) make a profit of $0. D) incur a loss of $20,000.
Q:
__________ often accompany short sales and are used to limit potential losses from the short position.
A. Limit orders
B. Restricted orders
C. Limit loss orders
D. Stop-buy orders
Q:
When a parent acquires the preferred stock of a subsidiary, there will be a constructive retirement and
A) any difference paid above the book value of the preferred stock reduces the parent's additional paid-in capital.
B) any difference paid above the book value of the preferred stock reduces the subsidiary's retained earnings.
C) any difference paid above the book value of the preferred stock increases the parent's additional paid-in capital.
D) any difference paid above the book value of the preferred stock increases the parent's retained earnings.
Q:
If a monopolist produces to a point at which marginal revenue is less than marginal cost thenA) the firm should increase output. B) the firm should reduce output. C) the firm is maximizing profits.D) we do not know if the firm should increase or reduce without more information.
Q:
What was the result of high-frequency traders' leaving the market during the flash crash of 2010?A. Market liquidity decreased.B. Market liquidity increased.C. Market volatility decreased.D. Trading frequency increased.
Q:
Assume a company's preferred stock is cumulative with a call provision and has dividends in arrears. The amount of stockholders' equity allocated to preferred stockholders is equal to the number of shares outstanding times the
A) sum of the par value per share plus any liquidation premium per share, plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, but only if dividends have been declared.
B) sum of the par value per share, plus any liquidation premium per share, plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, regardless of whether dividends have been declared.
C) call price plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, but only if dividends have been declared.
D) call price plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, regardless of whether dividends have been declared.
Q:
In the long run, the price for a perfectly competitive firmA) will be determined by the firmʹs supply and demand curves. B) will allow for positive economic profits.C) will equal marginal cost where marginal cost is at a minimum. D) will equal the minimum average total cost.
Q:
Pan Corporation has total stockholders' equity of $5,000,000 consisting of $1,000,000 of $10 par value Common Stock, $1,000,000 of Additional Paid-in Capital, and $3,000,000 of Retained Earnings. Pan owns 80% of Sailor Corporation's common stock purchased at book value, which equals fair value. Sailor has $900,000 of 10% cumulative preferred stock outstanding, with no preferred dividends in arrears. The preferred stock has no call price, redemption price or liquidation price. Pan acquired 60% of the preferred stock of Sailor for $500,000. After this transaction the balances in Pan's Retained Earnings and Additional Paid-in Capital accounts, respectively, are
A) $2,960,000 and $1,000,000.
B) $3,000,000 and $960,000.
C) $3,000,000 and $1,040,000.
D) $3,040,000 and $1,000,000.
Q:
Transactions that do not involve the original issue of securities take place in _________.
A. primary markets
B. secondary markets
C. over-the-counter markets
D. institutional markets
Q:
Which of the following conditions is TRUE for a profit -maximizing firm in a perfectly competitive industry?A) MR = TC B) ATC = AFC C) MR = MC D) MC = AVC
Q:
You sell short 200 shares of Doggie Treats Inc. that are currently selling at $25 per share. You post the 50% margin required on the short sale. If your broker requires a 30% maintenance margin, at what stock price will you get a margin call? (You earn no interest on the funds in your margin account, and the firm does not pay any dividends.)A. $28.85B. $35.71C. $31.50D. $32.25
Q:
MC = AVC and MC = ATC at points at whichA) the AVC and ATC curves are at their respective maximums.B) the AVC and ATC curves are at their respective minimums.C) the distance between the ATC and AVC curves is at its minimum. D) the distance between the ATC and AVC curves is at its maximum.
Q:
You purchased 250 shares of common stock on margin for $25 per share. The initial margin is 65%, and the stock pays no dividend. Your rate of return would be __________ if you sell the stock at $32 per share. Ignore interest on margin.
A. 35%
B. 39%
C. 43%
D. 28%
Q:
The focus of firm decisions in the short run is primarily onA) variable inputs. B) capital investment. C) plant size. D) economies of scale.
Q:
You purchased 200 shares of ABC common stock on margin at $50 per share. Assume the initial margin is 50% and the maintenance margin is 30%. You will get a margin call if the stock drops below ________. (Assume the stock pays no dividends, and ignore interest on the margin loan.)A. $26.55B. $35.71C. $28.95D. $30.77
Q:
The characteristic of limited liability enables corporations toA) avoid taxes on some of their profits. B) exist even when owners die. C) raise large amounts of financial capital. D) start up and dissolve easily.
Q:
On January 1, 2011, Pardy Corporation acquired a 70% interest in the common stock of Salter Corporation for $7,000,000 when Salter's stockholders' equity was as follows:10% cumulative, nonparticipating preferred stock,$100 par, with a $105 liquidation preference,callable at $110 $ 1,000,000Common stock, $10 par value 6,000,000Additional paid-in capital 1,500,000Retained earnings 2,500,000Total stockholders' equity $11,000,000There were no preferred dividends in arrears on January 1, 2011. There are no book value/fair value differentials.Assume Salter's net income for 2011 is $220,000. No dividends are declared or paid in 2011. What is the change in Pardy's Investment in Salter for the year ending December 31, 2011?A) $ 84,000B) $119,000C) $154,000D) $189,000
Q:
You short-sell 200 shares of Rock Creek Fly Fishing Co., now selling for $50 per share. If you want to limit your loss to $2,500, you should place a stop-buy order at ____.
A. $37.50
B. $62.50
C. $56.25
D. $59.75
Q:
If an individualʹs utility from consuming two goods increases, then there must beA) a downward rotation of the individualʹs indifference curve. B) an inward rotation of the individualʹs indifference curve.C) an outward shift of the individualʹs indifference curve. D) in inward shift of the individualʹs indifference curve.
Q:
You short-sell 200 shares of Tuckerton Trading Co., now selling for $50 per share. What is your maximum possible gain, ignoring transactions cost?
A. $50
B. $150
C. $10,000
D. unlimited
Q:
As an individual consumes more of a particular commodity, the total level of utility derived from that consumption willA) increase at an increasing rate. B) increase at a decreasing rate. C) increase at a constant rate. D) remain constant.
Q:
You short-sell 200 shares of Tuckerton Trading Co., now selling for $50 per share. What is your maximum possible loss?
A. $50
B. $150
C. $10,000
D. unlimited
Q:
A subsidiary has dilutive securities outstanding that include convertible bonds payable. The bonds are convertible into the parent's common stock. When calculating consolidated diluted earnings per share, the convertible bonds will affect
A) the numerator of consolidated diluted EPS only.
B) the denominator of consolidated diluted EPS only.
C) the numerator and denominator of consolidated diluted EPS.
D) None of the above will be affected.
Q:
When two goods are unrelated,
A) the demands for both goods will be inelastic.
B) cross price elasticity of demand will be 0.
C) cross price elasticity of demand will be negative.
D) cross price elasticity of demand will be positive.
Q:
You sold short 300 shares of common stock at $30 per share. The initial margin is 50%. You must put up _________.
A. $4,500
B. $6,000
C. $9,000
D. $10,000
Q:
The value of the absolute price elasticity of demand for good X is 4. The absolute price elasticity for good Y is 1. Which goodʹs quantity demanded is more responsive to a change in price?A) Good X. B) Good Y.C) They are equally responsive. D) Not enough information is given.
Q:
Assume you purchased 500 shares of XYZ common stock on margin at $40 per share from your broker. If the initial margin is 60%, the amount you borrowed from the broker is _________.A. $20,000B. $12,000C. $8,000D. $15,000
Q:
Quantity of Clean Air (%)Marginal Cost ($)Marginal Benefit ($)010,000100,0002525,00050,0005037,50037,5007575,00025,000100Infinite0The above table shows marginal costs and marginal benefits of clean air in a particular industrial area. In the table, when the quantity of clean air is at 75 percent,A) the quantity of polluted air is 75 percent.B) the marginal benefit of clean air exceeds the marginal cost.C) the marginal benefit of clean air is less than the marginal cost. D) the quantity of clean air is optimal.
Q:
What happened to the effective spread on trades when the SEC allowed the minimum tick size to move from one-eighth of a dollar to one-sixteenth of a dollar in 1997 and from one-sixteenth of a dollar to one cent in 2001?
A. The effective spread increased in 1997 but decreased in 2001.
B. The effective spread increased in both cases.
C. The effective spread decreased in 1997 but increased in 2001.
D. The effective spread decreased in both cases.
Q:
The incidence of absolute poverty is reduced by A) annual recalculations of the poverty line. B) government welfare programs.C) economic growth.D) the size of the budget deficit.
Q:
According to SEC Rule 415 regarding shelf registration, firms can gradually sell securities to the public for __________ following initial registration.
A. 1 year
B. 2 years
C. 3 years
D. 4 years
Q:
On January 1, 2011, Adam Corporation purchased a 90% interest in Rodney Corporation. On January 1, 2011, Rodney Corporation purchased an 80% interest in Ben Corporation.In all investment acquisitions, the cost of the interest was equal to the book value of the interest and the fair value of the interest. The following information is available for 2011:Purchase Cost Net Income(Net Loss) for 2011Adam $1,000,000 $200,000Rodney $10,000 ($10,000)Ben $15,000 $50,000The separate net incomes do not include investment income.Required:1. What is controlling interest share of consolidated net income for 2011?2. What is noncontrolling interest shares of consolidated net income for 2011?
Q:
A firm that is a monopsonist in the labor market and a monopolist in the product market will hire labor to the point at whichA) MFC = MRPm.B) a perfectly elastic labor supply = MRP.C) a perfectly inelastic labor supply = perfectly inelastic labor demand. D) where supply of labor = demand for labor.
Q:
You find that the bid and ask prices for a stock are $10.25 and $10.30, respectively. If you purchase or sell the stock, you must pay a flat commission of $25. If you buy 100 shares of the stock and immediately sell them, what is your total implied and actual transaction cost in dollars?
A. $50
B. $25
C. $30
D. $55
Q:
On January 1, 2011, Paul Corporation acquired a 90% interest in Satorius Company for $360,000 when Satorius' stockholders' equity was $400,000; with Common stock $200,000 and Retained earnings $200,000.On January 1, 2011, Satorius Company purchased a 10% interest in Paul Company for $90,000 when Paul's total stockholders' equity was $900,000; with Common stock $500,000 and Retained earnings $400,000.The following data was available for the year ending December 31, 2011:Paul Company Satorius CompanyNet income $150,000 $130,000Dividends 0 0Use the conventional approach to account for the mutually-held stock. Assume there were no book value/fair value differentials for each investment. The separate net incomes do not include investment income.Required:1. Prepare the journal entry for Paul on January 1, 2011.2. Prepare the journal entry for Satorius on January 1, 2011.3. Prepare the journal entry to record the constructive retirement of 10% of Paul's outstanding stock due to Satorius' purchase of Paul's stock.4. Determine the incomes of Paul and Satorius on a consolidated basis with mutual income for 2011 using simultaneous equations.5. What is controlling interest share of consolidated net income and noncontrolling interest shares for 2011?6. What is consolidated net income?