Which of the following is NOT one of Modigliani and Miller's set of conditions referred to as perfect capital markets?

A) All investors hold the efficient portfolio of assets.
B) There are no taxes, transaction costs, or issuance costs associated with security trading.
C) A firm's financing decisions neither change the cash flows generated by its investments, nor do they reveal new information about them.
D) Investors and firms can trade the same set of securities at competitive market prices equal to the present value (PV) of their future cash flows.


Answer: A

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With the current cost structure, Ortiz cannot achieve its profit goals. It will have to reduce either the fixed costs or the variable costs. Assuming that fixed costs cannot be reduced, what are the target variable costs per year? Assume all units produced are sold.

Ortiz Company is a price-taker and uses target pricing. Refer to the following information:



A) $10,114,000
B) $12,040,000
C) $5,600,000
D) $15,714,000

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Kaitlin is manager of the county library and is considering developing and implementing a reward and incentive system that helps promote good strategy execution. What should she AVOID doing in her strategy implementation effort?

A. The payoff for meeting or beating performance targets must be a major, not minor, piece of the total compensation package. B. Any incentive plan should extend to all managers and all employees, not just top management. C. The reward system must be administered with scrupulous objectivity and fairness. D. Ways must be found to reward deserving nonperformers who, for some reason, do not fare well under the incentive system. E. Make sure that the performance targets each individual or team is expected to achieve involve outcomes that the individual or team can personally affect.

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What are the union's obligations under a typical union contract?

What will be an ideal response?

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A firm with a great strategy will always attract investors.

Answer the following statement true (T) or false (F)

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