Question 1

Which financial ratio shows the after-tax earnings generated for each share of common stock?

Accepted Answer

A)  return on investment 
B)  return on equity 
C)  gross profit margin 
D)  earnings per share 
E)  net profit margin 
A)  return on investment 
B)  return on equity 
C)  gross profit margin 
D)  earnings per share 
E)  net profit margin

Question 2

What is the main purpose of conducting outside research into the environmental setting of the case?

Accepted Answer

A)  It allows students to identify how the company addressed the problem. 
B)  It provides a learning experience on library usage, which is helpful in all courses. 
C)  It gives a realistic background of the industry during a specified period. 
D)  It gives you clues as to what the organization should be doing in the future. 
E)  It furnishes large amounts of data-both pertinent and extraneous. 
A)  It allows students to identify how the company addressed the problem. 
B)  It provides a learning experience on library usage, which is helpful in all courses. 
C)  It gives a realistic background of the industry during a specified period. 
D)  It gives you clues as to what the organization should be doing in the future. 
E)  It furnishes large amounts of data-both pertinent and extraneous.

Question 3

Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's overall situation and pinpoint some problem areas.

Accepted Answer

A) True 
 B)False

Question 4

Which two basic statements provide most of the financial data needed for analysis?

Accepted Answer

A)  statement of retained earnings and income statement 
B)  sources and uses of working capital and the balance sheet 
C)  non-operating gains and losses and statement of financial position 
D)  historical income statement and balance sheet 
E)  statement of financial position and statement of owner's equity 
A)  statement of retained earnings and income statement 
B)  sources and uses of working capital and the balance sheet 
C)  non-operating gains and losses and statement of financial position 
D)  historical income statement and balance sheet 
E)  statement of financial position and statement of owner's equity

Question 5

According to the text, what percentage of security analysts use annual reports when making decisions?

Accepted Answer

A)  20% 
B)  35% 
C)  50% 
D)  75% 
E)  100% 
A)  20% 
B)  35% 
C)  50% 
D)  75% 
E)  100%

Question 6

To adjust for general inflation in the United States, what index does the text suggest?

Accepted Answer

A)  Dow-Jones Industrial Average 
B)  New York Stock Exchange Index 
C)  Wilshire 5000 Equity Index 
D)  Consumer Price Index 
E)  NASDAQ Series 
A)  Dow-Jones Industrial Average 
B)  New York Stock Exchange Index 
C)  Wilshire 5000 Equity Index 
D)  Consumer Price Index 
E)  NASDAQ Series

Question 7

Which of the following is not one of the categories of important financial ratios that are mentioned in the text to help assess an organization's overall financial situation?

Accepted Answer

A)  leverage ratios 
B)  liquidity ratios 
C)  asset management ratios 
D)  activity ratios 
E)  profitability ratios 
A)  leverage ratios 
B)  liquidity ratios 
C)  asset management ratios 
D)  activity ratios 
E)  profitability ratios

Question 8

What has been the most popular method of teaching strategy and policy for years?

Accepted Answer

A)  lecture 
B)  case analysis 
C)  team teaching 
D)  group presentations 
E)  student teaching 
A)  lecture 
B)  case analysis 
C)  team teaching 
D)  group presentations 
E)  student teaching

Question 9

The index of sustainable growth indicates how much of the growth rate of sales can be sustained by internally generated funds.

Accepted Answer

A) True 
 B)False

Question 10

Dollars adjusted for inflation to make them comparable over various years are known as

Accepted Answer

A)  consumer dollars. 
B)  constant dollars. 
C)  consumer inflation. 
D)  constant inflation. 
E)  earning dollars. 
A)  consumer dollars. 
B)  constant dollars. 
C)  consumer inflation. 
D)  constant inflation. 
E)  earning dollars.

Question 11

All of the following ratios are used in the calculation of a company's Z-value EXCEPT

Accepted Answer

A)  working capital/total assets. 
B)  retained earnings/total assets. 
C)  current assets/current liabilities. 
D)  market value of equity/total liabilities. 
E)  sales/total assets. 
A)  working capital/total assets. 
B)  retained earnings/total assets. 
C)  current assets/current liabilities. 
D)  market value of equity/total liabilities. 
E)  sales/total assets.

Question 12

The quick ratio is also known as the

Accepted Answer

A)  key profitability ratio. 
B)  EPS. 
C)  acid test. 
D)  asset turnover. 
E)  key activity ratio. 
A)  key profitability ratio. 
B)  EPS. 
C)  acid test. 
D)  asset turnover. 
E)  key activity ratio.

Question 13

A Z-value below 10 indicates significant credit problems.

Accepted Answer

A) True 
 B)False

Question 14

Which financial indicator measures the ratio of sales to fixed assets?

Accepted Answer

A)  days of inventory 
B)  asset turnover 
C)  average collection period 
D)  fixed asset turnover 
E)  inventory turnover 
A)  days of inventory 
B)  asset turnover 
C)  average collection period 
D)  fixed asset turnover 
E)  inventory turnover

Question 15

The formula that indicates if a company embarking on a growth strategy will need to take on debt to fund this growth is called

Accepted Answer

A)  the return on investment. 
B)  the CAPM. 
C)  the index of sustainable growth. 
D)  operating cash flow. 
E)  the Z-value. 
A)  the return on investment. 
B)  the CAPM. 
C)  the index of sustainable growth. 
D)  operating cash flow. 
E)  the Z-value.

Question 16

All of the following ratios reflect leverage ratios EXCEPT

Accepted Answer

A)  debt to asset ratio. 
B)  times interest earned. 
C)  coverage of fixed charges. 
D)  price/earnings ratio. 
E)  debt to equity ratio. 
A)  debt to asset ratio. 
B)  times interest earned. 
C)  coverage of fixed charges. 
D)  price/earnings ratio. 
E)  debt to equity ratio.

Question 17

The case method offers the opportunity to move from a narrow, specialized view that emphasizes functional techniques to a broader, less precise analysis of the overall corporation.

Accepted Answer

A) True 
 B)False

Question 18

The calculation of ratios from financial data is referred to as

Accepted Answer

A)  SWOT analysis. 
B)  ratio analysis. 
C)  receivables analysis. 
D)  integration analysis. 
E)  diversification analysis. 
A)  SWOT analysis. 
B)  ratio analysis. 
C)  receivables analysis. 
D)  integration analysis. 
E)  diversification analysis.

Question 19

Fixed asset turnover is what type of financial ratio?

Accepted Answer

A)  liquidity ratio 
B)  profitability ratio 
C)  leverage ratio 
D)  activity ratio 
E)  revenue ratio 
A)  liquidity ratio 
B)  profitability ratio 
C)  leverage ratio 
D)  activity ratio 
E)  revenue ratio

Question 20

A Z-value above 3.0 indicates significant credit problems for a firm.

Accepted Answer

A) True 
 B)False

Which financial ratio shows the after-tax earnings generated for each share of common stock?

What is the main purpose of conducting outside research into the environmental setting of the case?

Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's overall situation and pinpoint some problem areas.

Which two basic statements provide most of the financial data needed for analysis?

According to the text, what percentage of security analysts use annual reports when making decisions?

To adjust for general inflation in the United States, what index does the text suggest?

Which of the following is not one of the categories of important financial ratios that are mentioned in the text to help assess an organization's overall financial situation?

What has been the most popular method of teaching strategy and policy for years?

The index of sustainable growth indicates how much of the growth rate of sales can be sustained by internally generated funds.

Dollars adjusted for inflation to make them comparable over various years are known as

All of the following ratios are used in the calculation of a company's Z-value EXCEPT

The quick ratio is also known as the

A Z-value below 10 indicates significant credit problems.

Which financial indicator measures the ratio of sales to fixed assets?

The formula that indicates if a company embarking on a growth strategy will need to take on debt to fund this growth is called

All of the following ratios reflect leverage ratios EXCEPT

The case method offers the opportunity to move from a narrow, specialized view that emphasizes functional techniques to a broader, less precise analysis of the overall corporation.

The calculation of ratios from financial data is referred to as

Fixed asset turnover is what type of financial ratio?

A Z-value above 3.0 indicates significant credit problems for a firm.

Basic Concepts in Strategic Management

Corporate Governance

Social Responsibility and Ethics in Strategic Management

Environmental Scanning and Industry Analysis

Organizational Analysis and Competitive Advantage

Strategy Formulation: Business Strategy

Strategy Formulation: Corporate Strategy

Strategy Formulation: Functional Strategy and Strategic Choice

Strategy Implementation: Global Strategy

Strategy Implementation: Organizing and Structure

Strategy Implementation: Staffing and Directing

Evaluation and Control

Filters

Exam 13: Suggestions for Case Analysis

Which financial ratio shows the after-tax earnings generated for each share of common stock?

What is the main purpose of conducting outside research into the environmental setting of the case?

Ratio analysis is a valuable part of SWOT analysis, helping to assess the company's overall situation and pinpoint some problem areas.

Which two basic statements provide most of the financial data needed for analysis?

According to the text, what percentage of security analysts use annual reports when making decisions?

To adjust for general inflation in the United States, what index does the text suggest?

Which of the following is not one of the categories of important financial ratios that are mentioned in the text to help assess an organization's overall financial situation?

What has been the most popular method of teaching strategy and policy for years?

The index of sustainable growth indicates how much of the growth rate of sales can be sustained by internally generated funds.

Dollars adjusted for inflation to make them comparable over various years are known as

All of the following ratios are used in the calculation of a company's Z-value EXCEPT

The quick ratio is also known as the

A Z-value below 10 indicates significant credit problems.

Which financial indicator measures the ratio of sales to fixed assets?

The formula that indicates if a company embarking on a growth strategy will need to take on debt to fund this growth is called

All of the following ratios reflect leverage ratios EXCEPT

The case method offers the opportunity to move from a narrow, specialized view that emphasizes functional techniques to a broader, less precise analysis of the overall corporation.

The calculation of ratios from financial data is referred to as

Fixed asset turnover is what type of financial ratio?

A Z-value above 3.0 indicates significant credit problems for a firm.

Basic Concepts in Strategic Management

Corporate Governance

Social Responsibility and Ethics in Strategic Management

Environmental Scanning and Industry Analysis

Organizational Analysis and Competitive Advantage

Strategy Formulation: Business Strategy

Strategy Formulation: Corporate Strategy

Strategy Formulation: Functional Strategy and Strategic Choice

Strategy Implementation: Global Strategy

Strategy Implementation: Organizing and Structure

Strategy Implementation: Staffing and Directing

Evaluation and Control

Filters