What sort of defenses may an insurance company raise against payment on a claim?
> Is it possible for investors ever to require a lower rate of return on a company’s equity than on its debt, assuming that the debt is in a junk-bond category of quality?
> What is the primary difference between 20-year bonds issued by the U.S. government and 20-year bonds issued by IBM?
> If the returns from a security were known with certainty, what shape would the probability distribution of returns graph have?
> Why do yield curves sometimes have a downward slope and at other times have an upward slope?
> What factors determine investors’ required rates of return on corporate bonds? common stocks? U.S. government bonds?
> Discuss the general relationship between risk and expected return.
> How is risk defined in a financial sense?
> What is the risk structure of interest rates?
> What is the term structure of interest rates?
> The enclosed area in Figure 8.16 shows all the possible portfolios obtained by combining the given securities in different proportions (that is, the opportunity set). a. Which of the portfolios (A, B, C, D, E, or F) is (are) on the efficient frontier?
> Under what circumstances can the beta concept be used to estimate the rate of return required by investors in a stock? What problems are encountered when using the CAPM?
> How is a security’s beta value computed?
> What variables must be known (or estimated) in applying the capitalization of cash flow method of valuation to a physical or financial asset?
> The stock of Amrep Corporation has a beta value estimated to be 1.4. How would you interpret this beta value? How would you evaluate the firm’s systematic risk?
> Define the following terms. a. Risk b. Probability distribution c. Standard deviation d. Required rate of return e. Coefficient of variation f. Efficient portfolio g. Efficient frontier h. Capital market line i. Beta coefficient j. CAPM k. Corre
> What basic features of a lease are necessary to create a landlord-tenant relationship?
> What is a landlord’s lien and how may it be exercised?
> What is the difference between a tenancy at will and a tenancy at sufferance?
> What conditions must be satisfied before a person can acquire property by adverse possession?
> What warranties are contained in a quitclaim deed?
> What are the warranties implicit in a warranty deed?
> How does a license differ from an easement?
> What is the difference between an easement and a profit?
> To what extent may a life tenant use the land in which he or she has a life estate?
> What is a fee simple absolute
> What are goods?
> What two factors are usually considered by the courts in deciding whether property is a fixture?
> What is eminent domain?
> Do landowners always acquire air rights and subsurface rights to their property?
> If an engagement is called off, who should get the engagement ring?
> What effect do lost-property statutes have on the distinction among lost, mislaid, and abandoned property, and treasure trove?
> How is a bailment created?
> What are fungible goods?
> What is the difference between actual delivery and constructive delivery in creating a bailment?
> Are innkeepers and hotel owners strictly liable when their guests lose personal property on the premises?
> How may a bailor satisfy his duty to provide the bailee with goods that are free from hidden de¬fects that could injure the bailee?
> In most situations, when a breach of contract occurs, the injured party has a duty to do what?
> Discuss the two basic duties of a bailee.
> Does the 2005 act adequately balance the interests of creditors and debtors? Why or why not?
> Do bailees have the right to limit their bailment liability?
> What are fungible goods?
> Is it possible to deliver a gift of personal property over the Internet? Explain.
> What is the difference between mislaid, lost and abandoned property?
> How may a gift be delivered to a donee when physical delivery is impossible due to the nature of the gift itself?
> What are the three requirements for an effective gift?
> What is the difference between a tenancy in common and a joint tenancy?
> What is the difference between tangible and intangible personal property?
> What are the two principal types of damages recoverable on a breach of contract?
> A discharged debt is not treated as taxable income. If it were, how would a debtor’s situation be different?
> What information must be provided by one who is applying for an insurance policy?
> In what circumstances may an insurer cancel a policy?
> How is the effective date of an insurance policy usually determined?
> Who may be insured by a key-person insurance policy?
> Can anyone claim to have an insurable interest in a particular person or property?
> Discuss the concept of risk pooling.
> What is insurance?
> Do the automatic stay rules apply in Chapter 13 cases?
> What are three ways in which performance of a contract may become impossible in an objective sense?
> Can a Chapter 13 proceeding be initiated by involuntary petition?
> Who is eligible for relief under Chapter 13?
> In evaluating a debtor’s petition, what factors should be part of a good faith analysis? Should consideration of the calculation of disposable income play a role? Why or why not?
> What is the essential difference between bankruptcy under Chapter 7 and bankruptcy under Chapter 11?
> How are secured debts handled in a bankruptcy proceeding?
> What powers does a trustee have?
> Who can use Chapter 7?
> Can a mortgage be obtained legally at a favorable interest rate without many of the restrictions and much of the paperwork that attends the formal lending process?
> How does a short sale work?
> Were the changes to the Bankruptcy Code enacted in 2005 a factor in causing the recent recession?
> What is a statute of limitations?
> How might a borrower protect against falling victim to a dishonest lender or a mortgage scam?
> Should the federal government regulate the advertising of real property and mortgages on the Internet to protect consumers from potential fraud? If so, what kind of regulations would be appropriate, and how might they be enforced?
> What is Regulation Z, and to what type of transactions does it apply?
> Does the Truth-in-Lending Act adequately balance the interests of creditors and debtors? Why or why not?
> How might a notice of default and foreclosure actually benefit a debtor?
> Why do states require strict compliance with the provisions of their foreclosure laws, such as the requirement in this case that the lender own the note at the time of the complaint?
> What is the usual method of mortgage foreclosure?
> What are the differences between contracts of suretyship and guaranty contracts?
> How does garnishment work?
> How does a writ of execution work?
> How can mutual rescission take place?
> How does a mechanic’s lien work?
> What happens when a secured party claims a security interest in collateral that has been sold by the debtor?
> What happens when two secured parties claim security interests in the same collateral?
> What happens when a secured party and an unsecured party claim security interests in the same collateral?
> What is perfection?
> How is an interest in proceeds perfected?
> What is required for an enforceable security interest?
> What is the poison pill defense?
> When is a corporation that purchases the assets of another corporation normally responsible for the liabilities of the selling corporation?
> What is a self-tender?
> What are two ways in which performance of a contract can be accomplished?
> What is a tender offer?
> What sorts of corporate actions require the approval of both the board of directors and the shareholders?
> What is an appraisal right?
> What is a short-form merger?
> Describe the four steps by which a merger or consolidation takes place.
> 1. What advantages is a company likely to realize from a merger? 2. What is a possible disadvantage of a merger?
> What is the difference between a merger and a consolidation?
> How do the bad acts of corporate directors and officers who attempt to advance their own interests at the expense of the shareholders impact corporate governance?
> If a group of shareholders perceives that the corporation has suffered a wrong and the directors refuse to take action, can the shareholders compel the directors to act? If so, how?
