TIM 305 exam 1 questions with correct
answers
You |are |the |owner |of |a |Comfort |Inn |and |would |like |to |hire |a |new |general |manager. |In |terms |of
|preventing |possible |agency |problems, |what |should |you |include |in |your |offer? |- |CORRECT |
ANSWER✔✔-profit |sharing
The |best |way |to |address |agency |problems |is |- |CORRECT |ANSWER✔✔-design |the |initial |
contract |properly |with |appropriate |incentives.
A |value-creating |innovation |of |Marriott |was |- |CORRECT |ANSWER✔✔-guest |rewards |program.
If |you |wanted |to |take |actions |to |maximize |value |for |the |owners, |which |of |the |following |
actions |would |be |the |most |effective? |- |CORRECT |ANSWER✔✔-not |listed
Which |of |the |following |is |the |disadvantage |of |the |corporate |form |of |organization? |- |CORRECT |
ANSWER✔✔-the |tax |treatment |of |dividends
A |value-creating |innovation |of |Holiday |Inns |was |- |CORRECT |ANSWER✔✔-national |reservation |
system.
Which |of |the |following |is |the |best |description |of |how |McDonald's |created |value |for |their |
owners |in |the |breakfast |market? |- |CORRECT |ANSWER✔✔-They |generated |additional |revenues |
without |increasing |fixed |costs.
Agency |problems |arise |because |- |CORRECT |ANSWER✔✔-The |principal |is |shirking |from |her |
responsibility.
, Which |of |the |following |is |the |difficulty |in |forming |a |Subchapter |S |Corporation? |- |CORRECT |
ANSWER✔✔-There |can |be |no |more |than |75 |owners.
Value |is |created |if |a |project's |- |CORRECT |ANSWER✔✔-incremental |benefits |exceed |
incremental |costs.
The |goal |of |wealth |maximization |for |the |owners |makes |sense |for |the |firm |because |- |CORRECT |
ANSWER✔✔-if |we |have |satisfied |the |owners, |we |have |satisfied |all |other |parties |as |well.
Which |of |the |following |makes |preferred |stock |different |from |common |stock? |- |CORRECT |
ANSWER✔✔-Common |stockholders |can |vote |for |the |board |of |directors.
The |best |example |of |an |agency |problem |is |- |CORRECT |ANSWER✔✔-the |maintenance |manager
|arguing |with |the |housekeeping |manager |about |an |out-of-order |room.
The |three |factors |that |determine |the |value |of |future |dividends |are |- |CORRECT |ANSWER✔✔-
size, |timing, |and |risk.
Interest |expense |is |tax |deductible |but |dividends |are |not. |- |CORRECT |ANSWER✔✔-True
A |college |education |can |be |considered |an |investment. |- |CORRECT |ANSWER✔✔-True
The |return |on |commercial |paper |is |guaranteed |by |the |federal |government. |- |CORRECT |
ANSWER✔✔-False
The |current |yield |of |a |bond |is |the |rate |of |return |on |a |bond |if |you |hold |it |until |maturity. |- |
CORRECT |ANSWER✔✔-False
Futures |contracts |only |are |used |with |physical |commodities. |- |CORRECT |ANSWER✔✔-False
answers
You |are |the |owner |of |a |Comfort |Inn |and |would |like |to |hire |a |new |general |manager. |In |terms |of
|preventing |possible |agency |problems, |what |should |you |include |in |your |offer? |- |CORRECT |
ANSWER✔✔-profit |sharing
The |best |way |to |address |agency |problems |is |- |CORRECT |ANSWER✔✔-design |the |initial |
contract |properly |with |appropriate |incentives.
A |value-creating |innovation |of |Marriott |was |- |CORRECT |ANSWER✔✔-guest |rewards |program.
If |you |wanted |to |take |actions |to |maximize |value |for |the |owners, |which |of |the |following |
actions |would |be |the |most |effective? |- |CORRECT |ANSWER✔✔-not |listed
Which |of |the |following |is |the |disadvantage |of |the |corporate |form |of |organization? |- |CORRECT |
ANSWER✔✔-the |tax |treatment |of |dividends
A |value-creating |innovation |of |Holiday |Inns |was |- |CORRECT |ANSWER✔✔-national |reservation |
system.
Which |of |the |following |is |the |best |description |of |how |McDonald's |created |value |for |their |
owners |in |the |breakfast |market? |- |CORRECT |ANSWER✔✔-They |generated |additional |revenues |
without |increasing |fixed |costs.
Agency |problems |arise |because |- |CORRECT |ANSWER✔✔-The |principal |is |shirking |from |her |
responsibility.
, Which |of |the |following |is |the |difficulty |in |forming |a |Subchapter |S |Corporation? |- |CORRECT |
ANSWER✔✔-There |can |be |no |more |than |75 |owners.
Value |is |created |if |a |project's |- |CORRECT |ANSWER✔✔-incremental |benefits |exceed |
incremental |costs.
The |goal |of |wealth |maximization |for |the |owners |makes |sense |for |the |firm |because |- |CORRECT |
ANSWER✔✔-if |we |have |satisfied |the |owners, |we |have |satisfied |all |other |parties |as |well.
Which |of |the |following |makes |preferred |stock |different |from |common |stock? |- |CORRECT |
ANSWER✔✔-Common |stockholders |can |vote |for |the |board |of |directors.
The |best |example |of |an |agency |problem |is |- |CORRECT |ANSWER✔✔-the |maintenance |manager
|arguing |with |the |housekeeping |manager |about |an |out-of-order |room.
The |three |factors |that |determine |the |value |of |future |dividends |are |- |CORRECT |ANSWER✔✔-
size, |timing, |and |risk.
Interest |expense |is |tax |deductible |but |dividends |are |not. |- |CORRECT |ANSWER✔✔-True
A |college |education |can |be |considered |an |investment. |- |CORRECT |ANSWER✔✔-True
The |return |on |commercial |paper |is |guaranteed |by |the |federal |government. |- |CORRECT |
ANSWER✔✔-False
The |current |yield |of |a |bond |is |the |rate |of |return |on |a |bond |if |you |hold |it |until |maturity. |- |
CORRECT |ANSWER✔✔-False
Futures |contracts |only |are |used |with |physical |commodities. |- |CORRECT |ANSWER✔✔-False
