Sixty percent of the customers of a fast food chain order the Whopper, fries and a drink. If a random sample of 15 cash register receipts is selected, what is the probability that 10 or more will show that the above three food items were ordered?

• A.0.403
• B.0.186
• C.None of these answers

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Default risk can be described as

• A.the risk that the issuer will fail to satisfy the terms of the obligation with respect to the timely payment of the amount borrowed.
• B.the risk that the issuer will fail to satisfy the terms of the obligation with respect to the timely payment of interest and repayment of the amount borrowed.
• C.the risk that the issuer will fail to satisfy the terms of the obligation with respect to the timely payment of interest.

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Assume that Able Corporation has paid and expensed several speeding fines for its salespeople.
Fines are never deductible for tax purposes. This will result in which of the following?

• A.No temporary difference.
• B.Taxable temporary difference and future income tax liability.
• C.Taxable temporary difference and future income tax asset.

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Which condition in general gives industry participants more pricing power?

• A.Overcapacity industry.
• B.Concentrated industry.
• C.Industry with low entry barriers.

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The expected return on the market for next period is 16%. The risk-free rate of return is 6%, and Zebra
Company has a beta that is 20% greater than that for the overall market. The required rate of return for this company is closest to:

• A.14%.
• B.16%.
• C.18%.

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