MCQs Flashcards
Safety Stock
A buffer for variations in demand and lead-time for delivery of material. It affects the REORDER POINT, but does enter into the quantity to be ordered
Under which of the following described lease terms would the lessee be responsible during the term of the lease for executory costs associated with the leased asset?
Net Lease Y/N
Net-Net Lease Y/N
Net Lease Y
Net-Net Lease Y
Under a net lease, the lessee assumes the executory costs associated with the asset during the lease, including such elements as maintenance, taxes and insurance.
In a net-net lease, the lessee assumes responsibility for the executory costs during the life of the lease, as well as for a residual value at the end of the lease.
Net Lease
Under a net lease, the lessee assumes the executory costs associated with the asset during the lease, including such elements as maintenance, taxes and insurance.
Net-Net Lease
In a net-net lease, the lessee assumes responsibility for the executory costs during the life of the lease, as well as for a residual value at the end of the lease.
Which of the following provides the most reliable form of electronic authentication?
A. Digital signature. B. Symmetric encryption. C. Asymmetric encryption. D. Digital certificate.
D. Digital certificate.
When a digital certificate is requested, an independent background check is completed to confirm the identity of the requesting entity.
Thus, a digital certificate provides a higher level of reliability than a digital signature.
Required Rate of Return Calculation
Required Rate = Risk Free Rate + Beta(Expected Rate - Risk Free Rate)
Which of the following risks increases the least with cloud-based computing compared with local server storage for an organization that implements cloud-based computing? A. Data loss. B. Vendor security failure. C. Global visibility. D. System hacks.
C. Global visibility.
Global visibility is not a risk of cloud-based computing.
The risk of data loss increases with cloud based computing compared with local server storage computing.
Which of the following statements concerning the use of short-term financing by an entity is/are correct?
I. Short-term financing generally offers greater financial flexibility than long-term financing.
II. Short-term financing generally has a lower interest rate than long-term financing.
III. Short-term financing generally has a lower risk of illiquidity than long-term financing.
A. I only is correct. B. I and II are correct. C. II and III are correct. D. I, II and III are correct.
B. I and II are correct.
In general, short-term financing offers a firm greater financial flexibility than does long-term financing. With short-term financing, the level of borrowing can be more readily expanded or contracted with changes in the need for funds.
With long-term financing, the level of borrowing cannot be readily adjusted with changes in needs, especially when there is a contraction in the need for debt. Short-term financing is generally cheaper than long-term financing.
For a given borrower at a particular point in time, interest rates on short-term borrowings, in general, are lower than interest rates on long-term borrowings.
Finally, III is not correct because short-term financing generally has a higher (not lower) risk of illiquidity than does long-term financing.
By its nature, short-term borrowing must be repaid or refinanced in the near term and, on an on-going basis, more often than long-term debt.
Changes in the economic environment or within the entity, may make it impossible for the firm to either repay or refinance the debt. In that case, the firm would be technically insolvent.
After changes to a source program have been made and verified, it moves to A. Atlanta. B. Development. C. The operator. D. Production.
D. Production.
After changes and verification to those changes, source programs move into production.
The three generic strategies identified by Porter
Cost Leadership
Focus
Differentiation
Monopolistic Competition
Short run: can make normal profit if their average total cost
