Multiple choice

1) Which of the following is a non-cash expense?
A. Depreciation expenses
B. Interest expense
C. Packaging costs
D. Administrative salaries


2) The break-even model enables the manager of a firm to
A. calculate the minimum price of common stock for certain situations
B. set appropriate equilibrium thresholds
C. determine the quantity of output that must be sold to cover all operating costs
D. determine the optimal amount of debt financing to use


3) A zero-coupon bond
A. pays no interest
B. pays interest at a rate less than the market rate
C. is a junk bond
D. is sold at a deep discount at less than the par value


4) If you have $20,000 in an account earning 8% annually, what constant amount could you withdraw each year and have nothing remaining at the end of 5 years?
A. $3,525.62
B. $5,008.76
C. $3,408.88
D. $2,465.78