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Amy Farmer Is Planning to Invest in the Stock of Guthrie

question 14

Multiple Choice

Amy Farmer is planning to invest in the stock of Guthrie National Bank.She is examining ratios of the book value of the assets to the market value of the assets and the market value of the bonds held by the bank to their recorded value.What type of risk is Amy attempting to measure with these ratios?


Definitions:

Agency Fund

A fiduciary account used by governmental entities to manage funds collected on behalf of others, such as taxes or grants.

Enterprise Fund

A fund used by a government to account for operations financed by user charges for services provided by the government.

Internal Service Fund

A fund used within governmental accounting to manage the costs and financing of services provided by one department to other departments on a cost-reimbursement basis.

General Fund

The primary operating fund of a governmental entity, covering most basic services like police, fire, sanitation, and general administration.

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