1.GregStiles,CFA,hasrecentlyliquidatedmostofaclient’sportfoliobecausetheclientisplanningtobuyahouse.Stilesinformsoneofthebrokersinhisofficewhohashisrealestatelicenseabouttheplansofhisclient.WithrespecttoStandardIII(E),PreservationofConfidentiality,thisaction:
Selectexactly1answersfromthefollowing:
A.isappropriatesinceStilesonlytellsalicensedsalesman.
B.isappropriatesinceStileswaiteduntilaftertheliquidationofthesecurities.
C.isappropriatesinceStileskeepstheinformationinthefirm.
D.violatestheStandardunlesstheclientasksStilestotellthelicensedsalesman.
2.Afirmissuesa$5millionzerocouponbondwithamaturityoffouryearswhenmarketratesare8percent.Assumingsemiannualcompoundingperiods,thetotalinterestonthisbondis:Selectexactly1answersfromthefollowing:
A.$1,200,000.
B.$1,200,411.
C.$1,346,549.
D.$1,600,000.
3.TheJMEJumpers,aprofessionalvolleyballteam,sellsseasonticketstoallhomegames.Thecostofaseasonticketis$1,000andtheteamplays20homegames,whichrunfromAprilthroughAugust.FortheyearendedJune30,2005,JMEsold1,200tickets,collected80percentoftheamountowed,andplayed12homegames.HowmuchrevenueshouldJMErecognize?Selectexactly1answersfromthefollowing:
A.$0.
B.$960,000.
C.$1,200,000.
D.$720,000.
4.Whichofthefollowingmostaccuratelydescribestheshapesoftheaveragevariablecost(AVC)andaveragetotalcost(ATC)curves?Selectexactly1answersfromthefollowing:
A.TheAVCandATCcurvesarebothU-shaped
B.TheAVCandATCcurvesbothdecreaseinitially,andthenflatten.
C.TheAVCcurveisU-shapedwhereastheATCcurvedeclinesinitiallythenflattens.
D.TheAVCcurvedeclinesinitiallythenflattens,whereastheATCcurveisU-shaped
5.Whichofthefollowingisadifferencebetweenprimaryandsecondarycapitalmarkets?Selectexactly1answersfromthefollowing:
A.Primarymarketsarewherestockstradewhilesecondarymarketsarewherebondstrade.
B.Bothprimaryandsecondarymarketsrelatetowherestocksandbondstradeaftertheirinitialoffering.
C.Secondarycapitalmarketsrelatetothesaleofnewissuesofbonds,preferred,andcommonstock,whileprimarycapitalmarketsarewheresecuritiestradeaftertheirinitialoffering.
D.Primarycapitalmarketsrelatetothesaleofnewissuesofbonds,preferred,andcommonstock,whilesecondarycapitalmarketsarewheresecuritiestradeaftertheirinitialoffering.
