Bankruptcy prediction research has identified three broad factors influencing long-term solvency risk, which of the following is not one of the factors? Select one or more: a

1. Bankruptcy prediction research has identified three broad factors influencing long-term solvency risk, which of the following is not one of the factors?
   Select one or more:
   a. Credit factors
   b. Financing factors
   c. Operating factors
   d. Investment factors

a

2. Which of the following is not one of the three explanatory variables that determine a firm's market beta?
   Select one or more:
   a. Degree of operating leverage
   b. Degree of investing leverage
   c. Variability of sales
   d. Degree of financial leverage

b

3. Which of the following states of financial distress would be considered the most troubling for an investor or creditor?
   Select one or more:
   a. paying an accounts payable after the billing date
   b. failing to make a required interest payment on time
   c. defaulting on a principal payment on debt
   d. restructuring debt

c

4. If a customer wanted to obtain bank financing which of the following will the bank inquire about before granting a loan?
   Select one or more:
   a. Firms credit history
   b. financial position of the firms creditors
   c. a and c
   d. firms cash flow

c

5. The quick acid test ratio contains all of the following except:
   Select one or more:
   a. prepaid assets
   b. cash
   c. accounts receivable
   d. marketable securities

a

6. All of the following are common industry risks faced by companies except:
   Select one or more:
   a. technology
   b. competition
   c. litigation
   d. regulation

c

7. All of the following are common domestic risks faced by companies except:
   Select one or more:
   a. recessions
   b. technology
   c. inflation
   d. demographic shifts

b

8. All of the following are common international risks faced by companies except:
   Select one or more:
   a. dependence on one or a few suppliers
   b. exchange rate changes
   c. asset expropriation
   d. political unrest

a

9. All of the following typically drive firm-specific risks except:
   Select one or more:
   a. demographic shifts
   b. competition
   c. the nature of the business
   d. supplier relationships

a

10. Which of the following can companies use as collateral for a loan?
    Select one or more:
    a. prepaid rent
    b. property, plant, and equipment
    c. prepaid insurance
    d. retained earnings

b