ENSC201 TEST#1 3Oct2007
NAME:________________________ID#____________
(short, point form answers are preferred. 1
point per question.) SCORE:____/20
(NO PARTIAL POINTS. EACH QUESTION GETS A
1 or a 0)
1. Which are correct? (only a is correct – for 1 point)
a.Tax
avoidance is legal and tax evasion is illegal
b.Tax evasion is legal and
tax avoidance is illegal
c.Both tax avoidance and tax
evasion are legal under certain conditions
d.Both tax avoidance and tax
evasion are illegal under all conditions
2. Which are correct? Monitoring prime interest rate is important because:
a.
it serves as a benchmark for investment decision making
b.
large fluctuations signal economic instability
c.
so many other variables are dependent on it
d.
it allows us to make reasonable financial estimates
(1 point if at least
3 are selected)
3. Which are correct? When a company like TD Bank takes
over another company,
a. it can do so by issuing new shares to the target company’s
shareholders
b.
it can only do so if it has large cash reserves
(TD is paying $8.5 billion)
c. it can pay a
combination of cash and shares to the target’s shareholders
(1 point if a or c or both are
selected. 0 points if b is selected)
4. An incorporated company in BC must have at least one of which of the
following
words in its name?
Co, Company, Inc,
Incorporated, Ltd, Limited, Corp, Corporation, Ent,
Enterprise, Venture, LLP
(must
have at least 4 of these for 1 point, 0 if any of the others are selected))
5. Which are correct?
a. Incorporation
entails the creation of a legal “person”
b. A CCPC
is a special type of incorporated entity
c. Corporations must, by law, maximize profits
d. Corporations
protect shareholders from liability issues
e. CCPC's cannot be sued
by investors
(at least 2 of a,b,d must be selected for
full points. 0 points if c or e are selected)
True/False: (1 point each)
6. T/F: All types of corporations in BC must comply with the BC Securities
Act.
7. T/F: Only lawyers can legally incorporate a company.
8. T/F: All businesses must report income and profits and pay taxes to
Government
9. T/F: Incorporated companies
must have at least one director.
10. T/F: All countries, except the USA, grant patents
to those who are first to invent.
11. What are the 4P's of marketing?
PRICE, PRODUCT, PROMOTION, PLACE (Must have ALL 4 for 1 point)
12. What is a Patent?
IT IS A LEGAL RIGHT GRANTED BY A GOVERNMENT THAT GIVES THE
PATENT OWNER THE EXCLUSIVE RIGHT TO
USE THE INVENTION
(COULD ALSO SAY THE RIGHT TO PREVENT OTHERS FROM
USING ONE'S
INVENTION)
(or something close to that – for 1
point)
13. What does it cost (approx) to get
a
Approx.
$10,000 (1
point if between $5,000 and $20,000; 0 otherwise)
14. How long does a Patent last?
20
years (1 point, must be exact.)
15. What are the 3 criteria for
patentability?
1.NOVEL 2.USEFUL 3.NON-OBVIOUS
(must state ALL 3 or use
similar terms for 1 point, 0 for partial answer)
16. What's a Provisional Patent Application?
It
is a preliminary patent filing in the
1-year period during which she must
file a full patent. It establishes a priority date.
(must say
“preliminary” and “1-year” for 1 point)
17. What can invalidate an issued
patent?
The
discovery of prior art or a false statement in a patent (eg
exclusion of an
inventor) (must state either one for 1 point;
other answers may be possible)
18. A local BC tech company’s shares
are trading at $2.00. Its market cap is $20
million. Its earnings are $1
million. Its Earnings per Share are: _______.
10 cents per share.
Because: From the Market Cap, we
know there must be 10 million shares issued,
i.e. 10m X $2 =
$20m. Therefore the earnings per share are $1m/10m
(must say 10 cents
for 1 point – no explanation required)
19. Why did the DOW hit a new high this week?
Some
of the reasons given were lower prime rate and anticipation of further rate
cuts, subprime
worries subsided, corporate profit potential, reduced inflation worry
(any one of these or any other good
response gets a point)
20. Some people think patents are good. Others think they are bad. Argue for
the
latter.
(graded liberally – could make any good argument for a full point, such
as too
expensive for entrepreneurs, need
deep pockets to defend patents, it’s a game for
lawyers to get rich, can stifle
innovation because people are afraid of being sued)