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NEW QUESTION: 1
Which of the following accounting pronouncements is the most authoritative?
A. FASB Technical Bulletin.
B. AICPA Accounting Principles Board Opinion.
C. AICPA Statement of Position.
D. FASB Statement of Financial Accounting Concepts.
Answer: B
Explanation:
Choice "c" is correct. The AICPA accounting principal board opinion (APBO) is a first floor (category A) of
established accounting principle pronouncements.
Choice "a" is incorrect. FASB statement of financial accounting concepts (SFAC or FACs) is a fifth floor
(other accounting literature) category.
Choice "b" is incorrect. FASB technical bulletins are a second floor (category B) accounting
pronouncement.
Choice "d" is incorrect. AICPA statement of position is a second floor (category B) accounting
pronouncement.

NEW QUESTION: 2
Both portfolio Y and Z are well-diversified. The risk-free rate is 6%, the expected return on the market is 15%, and the portfolios have the following characteristics:
Portfolio | Expected Return | Beta Y | 17% | 1.20 Z | 14% | 1.00
Which of the following best characterizes the valuations of portfolio Y and Z?
A. Y is overvalued and Z is correctly valued.
B. Y is undervalued and Z is overvalued.
C. Y is undervalued and Z is correctly valued.
Answer: B
Explanation:
Because both portfolios are completely diversified, their returns should only reflect systematic risk of the portfolios. Thus, their betas are informative but their deviations are relevant. The required return for each portfolio can be calculated using the CAPM and compared with the associated market-implied expected return.
Y is undervalued. Its CAPM return is 6 + 1.2 x (15 - 6) = 16.8%. yet it has an expected return of 17%. Thus, the portfolio offers more return than is required given its level of risk and would therefore be attractive to investors. In contrast, Z is overvalued. Its CAPM return is 6 + 1.0 x (15 - 6) = 15%. However, it has an expected return of 14%. Thus, the portfolio offers less return than is required given its level of risk and would therefore be unattractive to investors.

NEW QUESTION: 3
In the Common Language Runtime (CLR), what information is used to make decisions on security policy?
A. Code group
B. Cryptography
C. Evidence
D. Permissions
Answer: A