3580064
Description
Quiz by Angie Koslowski, updated more than 1 year ago
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Created by Angie Koslowski
over 8 years ago
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Question 1
Question
The main goal of the financial manager is to increase the firm's overall profits
Answer
- True
- False
Question 2
Question
In a corporation, profits are generally measured in terms of earnings per share
Answer
- True
- False
Question 3
Question
There 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.
Answer
- True
- False
Question 4
Question
A firm's earnings are a true representation of cash flows available to the stockholders
Answer
- True
- False
Question 5
Question
Agency 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.
Answer
- True
- False
Question 6
Question
Because of tax benefits, financial managers prefer cash flows later rather than sooner
Answer
- True
- False
Question 7
Question
The ethical behavior of the financial manager has a substantial impact on the shareholder's wealth maximization concept
Answer
- True
- False
Question 8
Question
Information asymmetry means that all market participants have exactly the same information set with which to make decisions.
Answer
- True
- False
Question 9
Question
The best deals in the market will go to the first investor who can recognize them and act on them
Answer
- True
- False
Question 10
Question
The required rate of return is what you think you will get
Answer
- True
- False
Question 11
Question
Which of the following is not one of the primary activities of the financial manager?
Answer
-
Making financing decisions
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Prepare financial statements
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Make investment decisions
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Perform financial analysis
Question 12
Question
The main goal of the financial manager is to
Answer
-
maximize profit
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maximize shareholder wealth
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minimize costs
Question 13
Question
___________ can be defined as the art and science of managing money
Answer
-
economics
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finance
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accounting
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banking
Question 14
Question
When the risk of an investment is high, the rate of return required by the investor will be
Answer
-
moderate
-
high
-
low
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equal to a 30 day T-bill
Question 15
Question
The wealth of the shareholders of a corporation is represented by
Answer
-
price of stock
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earnings per share
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profits
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cash flows
Question 16
Question
If the managers of a company are not the owners of the company, they are considered
Answer
-
directors
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shareholders
-
insiders
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agents
Question 17
Question
Agency costs pose the biggest problem for
Answer
-
directors
-
shareholders
-
insiders
-
agents
Question 18
Question
The largest provider of funds in the financial system is
Answer
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individuals
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businesses
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government agencies
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Bill Gates
Question 19
Question
Investments, markets and institutions, and corporate finance are
Answer
-
not related
-
closely related
-
only moderately related
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not normally thought of as "finance"
Question 20
Question
The problem with profit maximization is that it is
Answer
-
short sighted
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ignores risk
-
ignores timing of cash flows
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all of the above
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