寂寂无言15. The smallest component of domestic net worth in 2012 was
A. nonresidential real estate.
B. residential real estate.
C. inventories.
D. consumer durables.
E. equipment and software. See Table 1.2.
AACSB: Analytic Blooms: Remember Difficulty: Intermediate
Topic: Assets
16. The national net worth of the U.S. in 2012 was
A. $15.411 trillion.
B. $26.431 trillion.
C. $42.669 trillion.
D. $48.616 trillion.
E. $70.983 trillion. See Table 1.2.
AACSB: Analytic Blooms: Remember Difficulty: Intermediate
Topic: Assets
1-31
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17. A fixed-income security pays
A. a fixed level of income for the life of the owner.
B. a fixed stream of income or a stream of income that is determined according to a
specified formula for the life of the security.
C. a variable level of income for owners on a fixed income.
D. a fixed or variable income stream at the option of the owner.
A fixed-income security pays a fixed stream of income or a stream of income that is determined according to a specified formula for the life of the security.
AACSB: Analytic Blooms: Remember
Difficulty: Basic Topic: Asset Types
18. A debt security pays
A. a fixed level of income for the life of the owner.
B. a variable level of income for owners on a fixed income.
C. a fixed or variable income stream at the option of the owner.
D. a fixed stream of income or a stream of income that is determined according to a
specified formula for the life of the security.
A debt security pays a fixed stream of income or a stream of income that is determined according to a specified formula for the life of the security.
AACSB: Analytic Blooms: Remember
Difficulty: Basic Topic: Asset Types
1-32
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McGraw-Hill Education.
19. Money market securities
A. are short term.
B. are highly marketable.
C. are generally very low risk.
D. are highly marketable and are generally very low risk.
E. All of the options All answers are correct.
AACSB: Analytic Blooms: Remember
Difficulty: Basic Topic: Asset Types
20. An example of a derivative security is
A. a common share of Microsoft.
B. a call option on Intel stock.
C. a commodity futures contract.
D. a call option on Intel stock and a commodity futures contract.
E. a common share of Microsoft and a call option on Intel stock.
The values of a call option on Intel stock and a commodity futures contract are derived from that of an underlying asset; the value of a common share of Microsoft is based on the value of the firm only.
AACSB: Analytic Blooms: Remember
Difficulty: Basic
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McGraw-Hill Education.
Topic: Asset Types
21. The value of a derivative security
A. depends on the value of the related security.
B. is unable to be calculated.
C. is unrelated to the value of the related security.
D. has been enhanced due to the recent misuse and negative publicity regarding these
instruments.
E. is worthless today.
Of the factors cited above, only the value of the related security affects the value of the derivative and/or is a true statement.
AACSB: Analytic Blooms: Understand
Difficulty: Basic Topic: Asset Types
1-34
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22. Although derivatives can be used as speculative instruments, businesses most often use them to
A. attract customers.
B. appease stockholders.
C. offset debt.
D. hedge risks.
E. enhance their balance sheets.
Firms may use forward contracts and futures to protect against currency fluctuations or changes in commodity prices. Interest-rate options help companies control financing costs.
AACSB: Analytic Blooms: Remember
Difficulty: Basic Topic: Asset Types
23. Financial assets permit all of the following except
A. consumption timing.
B. allocation of risk.
C. separation of ownership and control.
D. elimination of risk.
Financial assets do not allow risk to be eliminated. However, they do permit allocation of risk, consumption timing, and separation of ownership and control.
AACSB: Analytic Blooms: Remember Difficulty: Intermediate
Topic: Assets
1-35
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McGraw-Hill Education.
