Finance Questions
Explore questions in the Finance category that you can ask Spark.E!
You are aware that your neighbor trades stocks based on confidential information he overhears at his workplace. This information is not available to the general public. This neighbor continually brags to you about the profits he earns on these trades. Given this, you would tend to argue that the financial markets are at best __________ form efficient.
Evidence seems to support the view that studying public information to identify mispriced stocks is:
Which one of the following is the most likely reason why a stock price might not react at all on the day that new information related to the stock's issuer is released? Assume the market is semi-strong form efficient.
Financial ratios should be interpreted with caution because it may be difficult to say with certainty what is a "good" value. For example, in the case of the current ratio, a "good" value is neither high nor low.
Land Land Land, Inc. has a total asset turnover ratio of 2.0. The average total asset turnover ratio for the firm's industry is 2.5. Based on this information you know that
The examination of ratios over time is called:
1. Wetsdale Financial Company and Commerce Financial Company have the same total assets, the same total assets turnover, and the same return on equity. However, Wetsdale has a higher return on assets than Commerce. Which of the following can explain these ratios? ROA= PM * TATR
A firm with financial leverage has a larger equity multiplier than an otherwise identical firm with no debt in its capital structure.
1. Net cash flow is generally defined as net income plus: NCF=NI+DEP
1. Land Land Land, Inc. has a return on common equity of 20%. The average return on common equity for the firm's industry is 25%. Based on this information you know that: profitability ratio
Land Land Land, Inc. has a current ratio of 2.0. The average current ratio for the firm's industry is 1.5. Based on this information you know that:
1. If sales, assets, and common equity remain constant, but the profit margin on sales goes up, which of the following should also be true?
the level of sales where the company will realize no income and will suffer no loss
The degree to which a company's net income reacts to a change in sales; provides a measure of the company's earnings volatility
Contribution margin formula gives answer in Dollars or Units?
Contribution margin ratio gives answer in dollars or units
the degree to which a company's net income reacts to change in sales; provides a measure of the company's earnings volatility(how fast does income react to changes in sales?)
the relative proportion in which each product is sold (when a company sells more than one product)
the degree of operating leverage can be used to determine the effect changes in sales will have on ____________
T/F with more sales volume, variable costs will _____