Day 24 Flashcards
Specifying objectives falls under which principle?
Risk Assessment
MCQ-00502
Policy and procedure deployment falls under which principle?
Existing Control Activities
MCQ-00502
Equation: CAPM
E = R + Beta(M - R)
MCQ-03386
Three elements needed to estimate the cost of Equity Capital
- Current dividends per share (D)
- Expected growth rate (g)
- Current market price per share of Common Stock (P)
MCQ-03920
Internal Controls Acronyms - 17 Principles
CRIME
- EBOCA
- SAFR
- OIE
- SOD
- CATP
Define: Lagging Economic Indicator
Tend to follow economic activity, or occur as a result of economic activity
EX:
1. Average duration of unemployment
2. Prime rate charged by banks
3. Consumer price index for services
MCQ-07816
Examples of Leading Economic Indicators:
- Price changes of materials
- Building permits for residential properties
- Orders for goods
- Average NEW Unemployment claims
- Average length of the workweek
- Money Supply (M2)
Note: Manufacturing and Trade Sales = Coincident Indicators
MCQ-07858
Factors That Shift Demand Curves:
WRITEN
- Wealth ↑, D↑ shift right
- Related Goods (Substitutes Price ↑, D ↑ & Complements Price↑, D↓)
- Income ↑, D↑
- Tastes
- Expectations P in future↑, buy now D↑
- Number of Buyers↑, D↑
MCQ-07836
What would cause the demand curve for a normal good to shift to the left?
The price of a substitute good decreases
MCQ-07833
A change in price of a product will result in ______
A change in the quantity demanded (movement along the demand curve) NOT a shift in demand
MCQ-07833
Elasticity = 0.0
Perfectly inelastic - Quantity demanded stays the same no matter how the price changes
- Demand Curves are Vertical
Ex: Pharmaceuticals - Insulin for Diabetics
MCQ-07859
Elasticity > 1.0
greater than 1.0
Demand = Elastic
As Price↑, Qty. D↓ and Revenue↓ - VERY SENSITIVE
MCQ-07859
Elasticity < 1.0
less than 1
Demand = Inelastic
*As Price↑, Qty. D↑ and Revenue↑
MCQ-07859
Effect on Equilibrium Quantity: D↑, S↑
D↑ Q↑, Increase S↑ Q↑
MCQ-07834
Effect on Equilibrium Quantity: D↑, S↓
D↑ Q↑, Indeterminate S↓ Q↓
MCQ-07834