The following information is to be used to solve problems $23$ and $24$:

The board of directors of XYZ Company met on Wednesday May $16,2012.$ During that meeting the quarterly dividend was raised to $$2\mathrm{.}50$ per share and the board declared that the next quarterly dividend would be paid on Monday July $2,2012$ to holders as of record on Friday June $15,2012.$ Assume that it takes four business days for stock ownership to transfer during a trade.

$23.$ When is the declaration date and record date?: $*$

a$.$ Declaration: May $16,2012,$ Record: June $15,2012$

b$.$ Declaration: May $16,2012,$ Record: July $2,1012$

c$.$ Declaration: June $15,2012,$ Record: July $2,2012$

d$.$ Declaration: June $16,2012,$ Record: July $2,2012$

$24.$ When is the ex$-$dividend date and payment date?: $*$

a$.$ Ex$-$dividend: May $16,2012,$ Payment: June $16,2012$

b$.$ Ex$-$dividend: June $11,2012,$ Payment: July $2,2012$

c$.$ Ex$-$dividend: June $15,2012,$ Payment: July $2,2012$

d$.$ Ex$-$dividend: June $15,2012,$ Payment: July $16,2012$

The following information is to be used to solve problems $25$ and $26$ :

You purchase a European call option contract on $100$ shares with a strike price of $$35\mathrm{.}00$ at a cost of $$1\mathrm{.}50$ per share. At expiration the stock price is $$39\mathrm{.}50.$

$25.$ What is the value of the contract at expiration?: $*$

a$.$ $$0$

b$.$ $$300$

c$.$ $$450$

d$.$ $$600$

$26.$ Assume there are no transaction costs. What is the net gain you experience at expiration?:

a$.$ $$150$

b$.$ $$300$

c$.$ $$450$

d$.$ There is not enough information provided to solve this problem

$27.$ You sell a European put option contract on $100$ shares with a strike price of $$40\mathrm{.}00$ at a cost of $$3\mathrm{.}00$ per share. At expiration the stock price is $$43\mathrm{.}00.$ What is the net gain you experience at expiration?: $*$

a$.$ $$(300)$

b$.$ $$0$

c$.$ $$300$

d$.$ $$4,300$

$28.$ What is the effective annual interest rate the company foregoes by paying on the due date $($net terms$)$ instead of taking the cash discount if the company is offered $\frac{1}{15}$ net $60$ payment terms $($assume $360$ days in a year and annual compounding$)?$: $*$

a$.8\mathrm{.}1\%$

b$.10\mathrm{.}0\%$

c$.12\mathrm{.}2\%$

d$.15\mathrm{.}0\%$

$29.$ Acme Company borrows $$100,000$ at an annual interest rate of $15\%$ with a compensating balance of $5\%.$ What is the effective annual interest rate on the loan?: $*$

a$.5\mathrm{.}0\%$

b$.10\mathrm{.}8\%$

c$.15\mathrm{.}0\%$

d$.15\mathrm{.}8\%$

$30.$ Company XYZ has annual credit sales of $$2,500,000.$ Collection of the credit sales are evenly spread out over the $250$ working days per year. The company's annual cost of borrowing is $7\%.$ How much would XYZ save each year by improving its receivables process by one day?: $*$

a$.$ $$700$

b$.$ $$1,000$

c$.$ $$2,500$

d$.$ $$10,000$