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True and False 1.A Firm will always need to have a current ratio greater than...

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Finance

True and False

1.A Firm will always need to have a current ratio greater than one to be solvent.

2.With Financial Leverage, a firm is looking at its fixed operating costs in relation to its EBIT?

3.Decreasing Accounts Receivable and Inventory are a source of funds.

4.Futures contracts are standard agreements with regard to size and maturity dates.

5.The Spot market is one in which an exchange rate for a future delivery of currencies can be fixed today.

6.Companies will put a collar on its interest rate exposure(In relation ti their borrowings) in order to fix the level of interest the firm will pay.

7.If the bid/offer rate if the US/Euro is 1.34 to 1.36 and the firm is selling Euros for dollars. The rate given by the bank will be 1.36.

8.It is potentially very costly for a firm to be carrying large cash balances on the balance sheet.

9.Interest Rate Parity allows a company to lock in profits by borrowing in the low interest rate currency and investing in the high interest rate currency?

10.When calculating Days Sales outstanding, it is important to include all credit and cash dales in the equation.

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