ECO 410 Week 11 Quiz – Strayer
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Quiz 10 Chapter 19 and 20
Working Capital Management
19.1 Trident Brazil's Operating Cycle
Multiple Choice
1)
Working capital management involves the management of:
A)
current and long-term assets.
B)
current assets and current liabilities.
C)
current liabilities and long-term assets.
D)
current liabilities and long-term debt and equity.
2) The
cash conversion cycle:
A) is a
subset of the operating cycle.
B)
occurs in the latter stages of the operating cycle.
C) is a
subset of the accounts receivable period.
D) all
of the above.
3) The
proper order of events for the operating cycle is:
A) input
serving period, accounts receivable period, inventory period, quotation period.
B)
quotation period, accounts receivable period, inventory period, input servicing
period.
C)
quotation period, input servicing period, inventory period, accounts receivable
period.
D)
accounts receivable period, input servicing period, quotation period, inventory
period.
4)
TrinityApps Corporation (US) has bid a price on a project for a Korean firm,
but the Korean firm has not yet placed an order. This portion of the operating
cycle is best described as the:
A)
quotation period.
B) input
sourcing period.
C) cash
conversion cycle.
D)
accounts payable cycle.
5) The
period in the cash cycle where the customer places the order, and the firm
determines what materials for manufacture are NOT in inventory is called the
________ period.
A)
quotation
B) input
sourcing
C)
accounts payable
D)
accounts receivable
6) The
accounts payable period of the operating cycle:
A) is
equal to the inventory period.
B) may
run concurrently but shorter than the inventory period.
C) may
run concurrently but longer than the inventory period.
D) Any
one of the above may be true.
True/False
1)
Typically, the inventory period and the accounts payable period at least
partially overlap in the firms operating cycle.
2)
Typically, the inventory period and the accounts receivable period at least
partially overlap in the firms operating cycle.
3) The
operating cycle begins with the quotation period and ends with the accounts
payable period.
19.2 Trident's Repositioning Decisions
Multiple Choice
1) Of
the following, which would NOT be a significant decision-making factor in a
multinational firm's repositioning decision-making?
A) the
subsidiary's tax environment (high or low)
B) the
stability of the local currency
C) the
ability to move capital in and out of the subsidiary's country
D) All
of the above are significant factors.
True/False
1) In a
country with a relatively high tax rate, it make sense the the MNE to
reposition cash flows TO that country.
2) The
MNE would prefer to leave capital with a firm in a country with high growth
prospects over the alternative of leaving capital with a firm in a country with
low growth prospects (other factors equal).
19.3 Constraints on Repositioning Funds
Multiple Choice
1) Each
of the following is listed by your authors as a constraint on repositioning
funds by an MNE EXCEPT:
A)
political constraints.
B) tax
constraints.
C)
transaction costs.
D) All
of the above are listed by your authors.
True/False
1) Local
liquidity needs sometimes impact a firm's worldwide optimal cash position.
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