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Question 1 of 10
1. Question
Which of the following statement is true regarding the date of record?
Correct
The date of record is the day on which the holders of record are supposed to receive the dividend.
Incorrect
The date of record is the day on which the holders of record are supposed to receive the dividend.
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Question 2 of 10
2. Question
Which of the following statement is true regarding the stock dividend?
Correct
A stock dividend is a payment made by the firm in the form of additional stock.
Incorrect
A stock dividend is a payment made by the firm in the form of additional stock.
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Question 3 of 10
3. Question
Which of the following statement is false for the stock split?
Correct
Stock splits reduce the par value of the stock but do not affect the common equity part of the balance sheet.
Incorrect
Stock splits reduce the par value of the stock but do not affect the common equity part of the balance sheet.
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Question 4 of 10
4. Question
What happens with dividends in the cumulative preferred stock?
Correct
In cumulative preferred stock, dividends are not paid but accumulate.
Incorrect
In cumulative preferred stock, dividends are not paid but accumulate.
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Question 5 of 10
5. Question
What happens with dividends in the noncumulative preferred stock?
Correct
In noncumulative preferred stock, dividends do not accumulate and are paid.
Incorrect
In noncumulative preferred stock, dividends do not accumulate and are paid.
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Question 6 of 10
6. Question
How the taxable equivalent yield is calculated?
Correct
Taxable equivalent yield is calculated as the tax-exempt yield divided by one minus the marginal tax rate.
Incorrect
Taxable equivalent yield is calculated as the tax-exempt yield divided by one minus the marginal tax rate.
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Question 7 of 10
7. Question
How the current yield is calculated?
Correct
The current yield is calculated as the annual coupon payment divided by the price of the bond.
Incorrect
The current yield is calculated as the annual coupon payment divided by the price of the bond.
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Question 8 of 10
8. Question
Which of the following statement best f=defines the duration of bond?
Correct
The duration of a bond is the average amount of time that it takes to capture interest and principal repayments.
Incorrect
The duration of a bond is the average amount of time that it takes to capture interest and principal repayments.
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Question 9 of 10
9. Question
Which of the following statement is true regarding the term Crummey power?
Correct
Crummey power is a technique that enables a person to receive a gift that is not eligible for a gift-tax exclusion and change it into a gift that is, in fact, eligible. Individuals often apply.
Incorrect
Crummey power is a technique that enables a person to receive a gift that is not eligible for a gift-tax exclusion and change it into a gift that is, in fact, eligible. Individuals often apply.
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Question 10 of 10
10. Question
Tiffany purchased a diamond ring many years ago, paying $2,000 at the time. Based on gold and diamond price estimates, the ring has appreciated by around 4% per year. She is now going to sell the ring, currently worth $7,000. How many years did Tiffany own the ring?
Correct
To determine that Tiffany has owned the ring for 32 years, PV= 2,000 FV=7,000 I= 4, PMT= 0 and solve for N, which in this case equals 32.
Incorrect
To determine that Tiffany has owned the ring for 32 years, PV= 2,000 FV=7,000 I= 4, PMT= 0 and solve for N, which in this case equals 32.