61. The statement of cash flows is designed to assist users in assessing each of the following, except .
A. the ability of a company to remain solvent
B. the company's profitability
C. the major sources of cash receipts during the period
D. the reasons why net cash flows from operating activities differ from net income
62. Which of the following is a main policy tool of the central bank? ______.
B. Open market operation
C. The prime rate
D. The money supply
63. Which of the following is not included in the statement of cash flows, or in a supplementary schedule accompanying the statement of cash flows? ______.
A. Disclosure of the amount of cash invested in money market funds during the accounting period
B. A reconciliation of net income to net cash flows from operating activities
C. Disclosure of investing or financing activities that did not involve cash
D. The amount of cash and cash equivalents owned by the business at the end of the accounting period
64. The yield on bank reserves is equal to ______.
A. the discount rate
B. the prime rate
C. a specific rate decided by the central bank
D. 0 percent
65. The feature of APT that offers the greatest potential advantage over the simple CAPM is the .
A. identification of anticipated changes in production, inflation, and term structure of interest rates as key factors explaining the risk-return relationship
B. superior measurement of the risk-free rate of return over historical time periods
C. use of several factors instead of a single market index to explain the risk-return relationship
D. variability of coefficients of sensitivity to the APT factors for a given asset over time
66. In documentary collection, the exporters present the documents to ______ after the goods have been shipped.
A. the remitting bank
B. the collecting bank
C. the reimbursing bank
D. the opening bank
67. If a bank has ______ rate-sensitive liabilities than assets, a ______ in interest rates will reduce bank profits, while a ______ in interest rates will raise bank profits.
B. more... decline... rise
C. more... rise... decline
68. An L/C applicant is unhappy with the goods he receives. He is due to pay a term bill of exchange. Which of the following course of action could take place? ______.
A. He is obliged to pay as the documents were in order
B. He can instruct the issuing bank not to debit him
C. He can pay a reduced amount to compensate for the inferior goods
D. He instructs the issuing bank to return the documents with a payment refusal statement to the beneficiary
69. Which of the following would be considered a Eurodollar? .
A. A U.S. dollar in a bank outside the U.S.
B. A U.S. dollar held as an international reserve asset by a foreign central bank
C. A Federal Reserve note (a dollar bill) in the pocket of a tourist visiting Europe
D. None of the above
70. Which of the following is usually least important as a measure of short-term liquidity? .
A. Quick ratio
B. Current ratio
C. Debt ratio
D. Cash flows from operating activities