1) If market interest rates rise:
a) Long-term bonds will rise in value more than short-term bonds.
b) Long-term bonds will decline in value more than short-term bonds.
c) Short-term bonds will decline in value more than long-term bonds.
d) Short-term bonds will rise in value more than long-term bonds.
2) How can investors reduce the risk associated with an investment portfolio without having to accept a lower expected return?
A) Increase the amount of money invested in the portfolio.
B) Wait until the stock market rises.
C) Purchase stocks that have exceptionally high standard deviations.
D) Purchase a variety of securities; i.e., diversify.
3) RBW Corp. has cash of $48,000; short-term notes payable of $35,000, accounts receivable of $100,000; accounts payable of $120,000; inventories of $200,000; and accruals of $90,000. What is RBWs current ratio?
a) 1.42
b) 0.64
c) 2.71
d) 1.57