Get IMANET CMA Exam Practice Questions - Real and Updated

Answer : C

Most types of costs either are variable or contain some mix of fixed and variable components. For example, labor and materials are primarily variable. Their amounts fluctuate with the relevant cost drivers. Selling expenses and overhead costs can be either fixed or variable. Depreciation, however, is strictly a fixed cost when viewed in a decision analysis situation because it requires no cash outlay. Instead, the initial acquisition of the long-lived asset requires the cash outlay.

Answer : D

An important measurement used in portfolio analysis is the covariance. It measures the volatility of returns together with their correlation with the return of other securities. For two stocks X and Y, if K is the expected return, Ki is a given outcome, and p is its probability, the covariance of X and Y is

Answer : D

According to Robbins, Organizational Behavior (6th ed. Prentice-Hall, 1993), rationally has the same assumptions as the optimizing (outcome maximizing) model for decision making. Rational decision making is fully objective and logical. The model assumes that a single, well-defined goal is to be maximized; that all relevant criteria and feasible options are known; that the criteria and options can be assigned numerical values and ranked; that preferences are constant (criteria and their assigned weights do not change); and that the decision maker will choose the option with the highest rank (the maximum benefits). However, rationality does not require an assumption about the vacancy of conflict.

Answer : A

If the market price is less than the exercise price, the option is considered to be ''out of the money'' because the call owner ordinarily would not exercise the option (it would resift in a loss) Pa'anga $100 for a $90 stock would result in negative proceeds of $10.

Answer : C

This question applies CVP analysis in a not-for-profit context in which the agency wishes to assist as many people as possible. Thus, a breakeven point must be calculated. Total revenue (the appropriation) equals fixed cost plus the product of unit variable cost (per-patient annual cost) and the number of patients who can be assisted given the available resources. The following are simultaneous equations stated in the two unknowns:

Because X must equal 5.000Y + $5,000.000, the second equation may be solved as follows for the per-patient annual cost (Y):