A Reduction in the Ratio Net Sales/average Property, Plant and Equipment

question 6

Multiple Choice

A reduction in the ratio net sales/average property, plant and equipment over time could mean:

• A) there is an elevated level of inflation.
• B) the price of plant and equipment is falling.
• C) the firm may be heading for a liquidity crisis.
• D) there is an over-investment in plant and equipment.

Calculate value-weighted and price-weighted indexes using stock price and outstanding share data.

Understand the different forms of short-term borrowing in the government securities market.

Understand the impact of stock splits on value-weighted indexes.

Recognize the largest actively-traded stock indexes and their attributes.

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Definitions:

Scienter

Knowledge of wrongdoing or fraudulent intent, often required to be proven in cases of securities fraud.

Unilateral Mistake

A situation in contract law where only one party is mistaken about a basic assumption on which the contract is based.

Subjective Value

The worth or importance of something based on personal preferences, opinions, or experiences, rather than its objective market value.

Fraudulent Misrepresentation

Occurs when one party deceives another by intentionally providing false information, leading to an agreement or transaction based on that misinformation.