FINANCE 201 UPDATED EXAM QUESTIONS
WITH 100% CORRECT ANSWERS
According to the reading, a budget is a plan to help control cash inflows and outflows.
True
In valuing assets for a net worth statement, all assets should be valued at their historical
cost.
False
According to the textbook, the inflation rate in the US has averaged about 6% per year
since 1926.
False
The formula for determining your net worth is
Assets - Liabilities
Which financial statement is like a "snap-shot-in-time" of your financial positions? Mark
all that apply.
Balance Sheet
The accounting equation is [----]
Assets = Liabilities + Equity.
According to the pamphlet "All is Safely Gathered in," the first step in managing family
finances is to "Use a Budget".
False
Which financial statement is a temporary statement over a period of time? Mark all that
apply.
Income Statement
Cash Flow Statement
According to the PowerPoint slides and the reading, "The starting point," or first step in
the financial planning and goal setting process is to:
Determine your net worth.
A Cash Flow statement for an individual is like an Income Statement for a business.
True
Which of the following is NOT a major U.S. stock market exchange?
, DOW
What type of stock tends to remain stable under difficult economic conditions such as a
food or healthcare company?
Defensive stock
If the stock market appears to be increasing during the long-term, it is considered a [----]
market
bull
Which of the following in NOT a type of SEC filing?
Form 10-Z
A stock's PE ratio is computed by
Current Stock Price `:-` EPS
The acronym "IPO" stands for
Initial Public Offering
Earnings Per Share (EPS) are calculated by which formula?
Company earnings `-:`Number of Shares Outstanding
Common stock is a(n) [----] investment in a company.
Equity
General Electric (ticker GE) is a component of DOW. What is General Electric?
Both "a" and "c"
A public company and a company in the private sector
If you sell stock that you borrowed from someone else, such as your broker, based on the
belief that the stock's price will decline, you are [----].
Selling short
For 2014, Microsoft's cash and cash equivalents (in millions) is $___________.
8,669
For 2014, Microsoft's EPS (use the "Diluted" number) is $_______________.
2.63
What is Microsoft's net change in cash and cash equivalents (in millions) during 2014?
$_______________
4,865
WITH 100% CORRECT ANSWERS
According to the reading, a budget is a plan to help control cash inflows and outflows.
True
In valuing assets for a net worth statement, all assets should be valued at their historical
cost.
False
According to the textbook, the inflation rate in the US has averaged about 6% per year
since 1926.
False
The formula for determining your net worth is
Assets - Liabilities
Which financial statement is like a "snap-shot-in-time" of your financial positions? Mark
all that apply.
Balance Sheet
The accounting equation is [----]
Assets = Liabilities + Equity.
According to the pamphlet "All is Safely Gathered in," the first step in managing family
finances is to "Use a Budget".
False
Which financial statement is a temporary statement over a period of time? Mark all that
apply.
Income Statement
Cash Flow Statement
According to the PowerPoint slides and the reading, "The starting point," or first step in
the financial planning and goal setting process is to:
Determine your net worth.
A Cash Flow statement for an individual is like an Income Statement for a business.
True
Which of the following is NOT a major U.S. stock market exchange?
, DOW
What type of stock tends to remain stable under difficult economic conditions such as a
food or healthcare company?
Defensive stock
If the stock market appears to be increasing during the long-term, it is considered a [----]
market
bull
Which of the following in NOT a type of SEC filing?
Form 10-Z
A stock's PE ratio is computed by
Current Stock Price `:-` EPS
The acronym "IPO" stands for
Initial Public Offering
Earnings Per Share (EPS) are calculated by which formula?
Company earnings `-:`Number of Shares Outstanding
Common stock is a(n) [----] investment in a company.
Equity
General Electric (ticker GE) is a component of DOW. What is General Electric?
Both "a" and "c"
A public company and a company in the private sector
If you sell stock that you borrowed from someone else, such as your broker, based on the
belief that the stock's price will decline, you are [----].
Selling short
For 2014, Microsoft's cash and cash equivalents (in millions) is $___________.
8,669
For 2014, Microsoft's EPS (use the "Diluted" number) is $_______________.
2.63
What is Microsoft's net change in cash and cash equivalents (in millions) during 2014?
$_______________
4,865
