Training test for current control 4

What are the names of the ratios that measure the ability of the company to pay its short-term debts?

• Liquidity ratios
• Debt ratios
• Interest coverage ratios
• Profitability ratios

How is the quick ratio determined?

• Current assets less inventory, divided by current liabilities
• Current assets divided by total debt
• Current assets divided by current liabilities
• Current assets less inventory, divided by total liabilities

Why does preference rest on the time value of money?

• Money available today is worth more than the same amount of money in the future
• Money received tomorrow can be invested to earn stocks
• Money available today is worth more than stocks
• Money received today is worth less than the same amount of money in the future

What is an important principle in finance?

• The value of money is time-dependent
• The value of a unit of money is similar in different time periods
• The value of a sum of money received today will not be received
• The time value of money will not be referred as time preference for money

Suppose you can buy 1 kg of rice for 50 cents today. If the inflation rate is 10%, how many cents will you need a year later?

• 55 cents
• 50 cents
• 45 cents
• 60 cents

What is the principle of “bird in the hand”?

• Money received now is certain, whereas money tomorrow is less certain
• Money received now is less certain, whereas money tomorrow is certain
• Value of money is time-dependent
• Money received yesterday can be invested to earn stocks

What are the methods to calculate the time value of money?

• Compounding technique, discounting technique
• Compounding technique, money exchange technique
• Annual-compounding technique
• Discounting technique, money exchange technique

What is interest?

• A rate that is charged or paid for the use of money
• A rate that assumes no risk or uncertainty
• A rate that expects aggregate prices to rise
• A rate that expects stock valuation

When do you pay interest to the bank?

• When you borrow money from a bank
• When you deposit money into a bank
• When you are the client of the bank
• When you work in the bank

When does the bank pay interest to a person?

• When a person deposits money into a bank
• When a person borrows money from a bank
• When a person is the client of the bank
• When a person works in the bank