FIN534 MIDTERM EXAM PART I & PART II 50 Questions solved

Question: #671

Chapter 1 of your textbook includes, on page 9, Table 1.1, “Managing Change: Some Lessons from the Four Stories.” Review the four “lessons” (bullet points) on the table, and think about what some of the key “learning points” you gleaned about change from these stories. Then, do one of two things:

1. Post the top three learning points you gleaned from the stories, and include how the stories for change helped you learn these points, or

2. Research one of the four companies and see how or if that company has since changed (yet more) since the time of the book’s publication. How did that recent change fit with or not fit in with the “lessons” that the textbook mentions the company “learned” from their original set of changes? Explain what you find (bring the URL of the research/article you used to help you).

Your instructor will follow up with you with additional questions throughout the week to push the learning further. Feel free to discuss your classmates’ findings and thoughts on these questions with each other as well.

Solution: #681

FIN534 MIDTERM EXAM PART I & PART II (50 Questions solved)

Fin 534 Midterm PART 1

Question 1

Which of the following statements is CORRECT?

Answer

The New York Stock Exchange is an auction market with a physical location.

Capital market transactions involve only the purchase and sale of equity securities, i.e., common stocks.

If an investor sells shares of stock through a broker, then this would be a primary market transaction.

Consumer automobile loans are evidenced by legal documents called "promissory notes," and these individual notes are traded in the money market.

While the distinctions are blurring as investment banks are today buying commercial banks, and vice versa, investment banks generally specialize in lending money, whereas commercial banks generally help companies raise capital from other parties.

Question 2

Which of the following statements is CORRECT?

Answer

Capital market instruments include both long-term debt and common stocks.

An example of a primary market transaction would be your uncle transferring 100 shares of Wal-Mart stock to you as a birthday gift.

The NYSE does not exist as a physical location; rather, it represents a loose collection of dealers who trade stocks electronically.

If your uncle in New York sold 100 shares of Microsoft through his broker to an investor in Los Angeles, this would be a primary market transaction.

While the two frequently perform similar functions, investment banks generally specialize in lending money, whereas commercial banks generally help companies raise large blocks of capital from investors.

Question 3

You recently sold 100 shares of your new company, XYZ Corporation, to your brother at a family reunion. At the reunion your brother gave you a check for the stock and you gave your brother the stock certificates. Which of the following statements best describes this transaction?

Answer

This is an example of an exchange of physical assets.

This is an example of a primary market transaction.

This is an example of a direct transfer of capital.

This is an example of a money market transaction.

This is an example of a derivatives market transaction

Question 4

Which of the following statements is CORRECT?

Answer

While the distinctions are blurring, investment banks generally specialize in lending money, whereas commercial banks generally help companies raise capital from other parties.

A security whose value is derived from the price of some other "underlying" asset is called a liquid security.

Money market mutual funds usually invest most of their money in a well-diversified portfolio of liquid common stocks.

Money markets are markets for common stocks and long-term debt.

The NYSE operates as an auction market, whereas the Nasdaq is a dealer market.

Question 5

Money markets are markets for

Answer

Foreign stocks.

Consumer automobile loans.

U.S. stocks.

Short-term debt securities.

Long-term bonds.

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