This is a 100 question hw sheet and I have answered all but i am unsure about a few please help!!!
8. Which of the following statements about when the Fed increases the reserve requirement
is correct?
A. Interest rates go down.
B. Banks have more money to lend.
C. Inflation tends to go up.
D. Banks have less money to lend.
I said A
9. Gross profit (gross margin) is equal to
A. gross sales minus net sales.
B. operating expenses minus taxes.
C. revenue minus cost of goods sold.
D. cost of goods sold minus operating expenses.
I said D
10. The first public offering of a corporation’s stock is called a/an _______, and it’s
handled by the _______ market.
A. IPO; primary C. PSO: secondary
B. IPO; secondary D. PSO; primary
I said A
11. The primary function of the Fed’s Board of Directors is to
A. supervise banks. C. regulate credit.
B. set monetary policy. D. buy government bonds.
I said C
13. An index fund is a mutual fund that
A. guarantees dividends.
B. offers a minimum return.
C. invests in stocks that follow Moody’s or other rating indexes.
D. invests only in certain kinds of stock, such as those related to transportation.
I said D
14. In referring to the money supply, which of the following can be accessed quickly and
easily and includes coins and paper money as well as checks?
A. M-1 C. M-3
B. M-2 D. e-cash
I said A
15. Daddy Warbucks bought Annie some stock for her birthday. The stock provides a fixed
dividend, and, if the dividend isn’t paid when it’s due, the missed dividend will accumulate
to be paid later. Daddy bought Annie _______ stock.
A. common C. convertible
B. preferred D. preemptive right
I said B
16. When a European coffee maker becomes less expensive to buy in the United States,
you could probably say that we’re experiencing a _______ dollar.
A. falling C. rising
B. inflated D. stable
I said B
17. Earnings per share, return on sales, and return on equity are all _______ ratios.
A. activity C. liquidity
B. profitability D. debt138
I said C
18. Regarding bonds, which statement is most accurate?
A. Bond holders are creditors, not owners.
B. Bond holdings are nearly always converted to common stock.
C. Bonds are a primary source for a company’s long-term funding.
D. It’s illegal for a firm to offer bonds with a floating dividend rate.
I said B
19. The first step in taking control of your finances is
A. keeping track of all your expenses.
B. preparing a budget.
C. paying off your debts.
D. taking an inventory of your assets.
I said D
20. The first step in the accounting cycle is
A. putting information into journals.
B. preparing a trial balance.
C. analyzing and categorizing documents.
D. posting transactions to ledgers.
I said C
22. A specialized accounting book in which information is posted into specific categories so
managers can find information about one account in the same place is called a
A. ledger. C. trial balance sheet.
B. journal. D. double-entry book.
I said D
23. When planning for your future, an investment in a college education will, above all,
A. provide you with new ideas.
B. give you a chance to learn about different ways of life.
C. improve your earning potential.
D. guarantee a certain desired job.
I said C
24. The type of accounting concerned with providing information and analyses to managers
within the organization is referred to as
A. financial accounting. C. auditing.
B. managerial accounting. D. tax accounting.
I said A
25. With respect to the Federal Reserve, the discount rate is the
A. interest rate charged for loans to member banks.
B. amount of money member banks must keep on hand at the Fed.
C. rate the Fed charges for selling bonds.
D. interest rate banks charge other banks
I said B
#18: B
Here are the correct answers to the questions you were unsure about:
8. The correct answer is D. When the Fed increases the reserve requirement, banks have less money to lend. This is because they are required to hold a higher percentage of their deposits as reserves, which reduces the amount available for lending.
9. The correct answer is C. Gross profit (gross margin) is equal to revenue minus the cost of goods sold. This represents the profit made from selling goods before deducting operating expenses and taxes.
10. The correct answer is B. The first public offering of a corporation's stock is called an IPO (Initial Public Offering), and it's handled by the primary market.
11. The correct answer is B. The primary function of the Fed's Board of Directors is to set monetary policy. They make decisions regarding interest rates, money supply, and credit conditions.
13. The correct answer is C. An index fund is a mutual fund that invests in stocks that follow Moody's or other rating indexes. It aims to replicate the performance of a specific index, such as the S&P 500.
14. The correct answer is A. In referring to the money supply, M-1 can be accessed quickly and easily and includes coins, paper money, and checks.
15. The correct answer is B. Daddy Warbucks bought Annie preferred stock. Preferred stock provides a fixed dividend and has priority over common stock in terms of receiving dividends.
16. The correct answer is A. When a European coffee maker becomes less expensive to buy in the United States, we're experiencing a falling dollar. This means that the value of the US dollar is decreasing relative to the European currency.
17. The correct answer is B. Earnings per share (EPS), return on sales (ROS), and return on equity (ROE) are all profitability ratios. They measure a company's ability to generate profits from its operations.
18. The correct answer is A. Bond holders are creditors, not owners. When you invest in bonds, you are lending money to the issuer and becoming a creditor.
19. The correct answer is B. The first step in taking control of your finances is preparing a budget. This involves creating a plan for your income, expenses, and savings goals.
20. The correct answer is A. The first step in the accounting cycle is putting information into journals. Journals are used to record the initial transactions of a business.
22. The correct answer is A. A specialized accounting book in which information is posted into specific categories so managers can find information about one account in the same place is called a ledger.
23. The correct answer is C. When planning for your future, an investment in a college education will improve your earning potential. Having a higher level of education often leads to higher-paying job opportunities.
24. The correct answer is B. The type of accounting concerned with providing information and analyses to managers within the organization is referred to as managerial accounting.
25. The correct answer is A. With respect to the Federal Reserve, the discount rate is the interest rate charged for loans to member banks.