1. Which of the following leads to less business risks compared to other factors?
a. High operating leverage? b. High percentage of fixed costs c. High interest rates d. More stable operations e. More financial risk
2. When the Federal Reserve buys $50 million in securities for its own portfolio that are being offered for sale by a foreign central bank, bank reserves and deposits will rise by the full amount.
True or False
3. Which of the following is an indication of a firm's risk with its capital structure?
a. Coefficient of variation b. Corporate income tax c. Earnings per share d. Indifference point e. Net operating income