Quiz
Finance Chapter One: Overview of Finance
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Questions in this quiz (20)
1The main goal of the financial manager is to increase the firm's overall profits
- ATrue
- BFalse
2In a corporation, profits are generally measured in terms of earnings per share
- ATrue
- BFalse
3There is a positive correlation that exists between risk and return. The higher the risk of an investment, the higher the required return will be on that investment.
- ATrue
- BFalse
4A firm's earnings are a true representation of cash flows available to the stockholders
- ATrue
- BFalse
5Agency costs are fees that are paid by the management of a corporation to compensate any investor that feels that they have suffered a loss due to the agency problem.
- ATrue
- BFalse
6Because of tax benefits, financial managers prefer cash flows later rather than sooner
- ATrue
- BFalse
7The ethical behavior of the financial manager has a substantial impact on the shareholder's wealth maximization concept
- ATrue
- BFalse
8Information asymmetry means that all market participants have exactly the same information set with which to make decisions.
- ATrue
- BFalse
9The best deals in the market will go to the first investor who can recognize them and act on them
- ATrue
- BFalse
10The required rate of return is what you think you will get
- ATrue
- BFalse
11Which of the following is not one of the primary activities of the financial manager?
- AMaking financing decisions
- BPrepare financial statements
- CMake investment decisions
- DPerform financial analysis
12The main goal of the financial manager is to
- Amaximize profit
- Bmaximize shareholder wealth
- Cminimize costs
13___________ can be defined as the art and science of managing money
- Aeconomics
- Bfinance
- Caccounting
- Dbanking
14When the risk of an investment is high, the rate of return required by the investor will be
- Amoderate
- Bhigh
- Clow
- Dequal to a 30 day T-bill
15The wealth of the shareholders of a corporation is represented by
- Aprice of stock
- Bearnings per share
- Cprofits
- Dcash flows
16If the managers of a company are not the owners of the company, they are considered
- Adirectors
- Bshareholders
- Cinsiders
- Dagents
17Agency costs pose the biggest problem for
- Adirectors
- Bshareholders
- Cinsiders
- Dagents
18The largest provider of funds in the financial system is
- Aindividuals
- Bbusinesses
- Cgovernment agencies
- DBill Gates
19Investments, markets and institutions, and corporate finance are
- Anot related
- Bclosely related
- Conly moderately related
- Dnot normally thought of as "finance"
20The problem with profit maximization is that it is
- Ashort sighted
- Bignores risk
- Cignores timing of cash flows
- Dall of the above
Information
- Description
- Quiz on Finance Chapter One: Overview of Finance, created by Angie Koslowski on 26/09/2015.
- Author
- Angie Koslowski
- Language
- English
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- 43
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