Exam 18: Finance Maximizing the Value

Tracy Lefteroff is the global managing partner for PricewaterhouseCoopers.She said that her company is eager to invest in newly created biotech companies because Canada has an aging population that will need new medications and treatments.Which of the following kinds of equity capital would Lefteroff be likely to provide?

Toronto Pneumatic Tools has changed its credit terms to encourage its buyers to pay their accounts receivable more quickly.Which of the following represents the policy that the financial manager has changed?

European Airlines forecast that its profits will increase by 2-4 percent for flights between Europe and Canada during the next 12 months.This prediction is part of which of the following activities?

The Four Seasons hotel chain has purchased an existing hotel in Mumbai.To forecast how much it needs to spend to bring the facilities in line with Four Seasons' other five-star hotels,it will use which of the following?

Why is the issuance and sale of preferred shares more expensive than debt financing?

What is the willingness to bear risk without insurance?

Which of the following are specific repayment conditions as to how long customers have to pay bills and the amount of cash discount allowed?

Preferred shares are a form of debt financing because the dividend must be paid before dividends can be paid to the equity owners.

Which of the following groups invest in new businesses in return for part of the ownership,sometimes as much as 60 percent?

Treasury bills,certificates of deposit,and mortgage loans are the most popular marketable securities.

Dividends are best described by which of the following?

As the Toronto-based Four Seasons hotel chain remodels an existing hotel in Mumbai to bring it to the five-star hotel's exacting standards,it is building a magnificent revolving restaurant overlooking the Arabian Sea.The restaurant structure is an example of which of the following?

For a risk to be insurable,it must be under the control of the insured.

What is most commonly used for collateral with secured loans?

What is another name for short-term forecasts?

A mortgage loan is a long-term loan that uses real estate as collateral.

A formal written forecast of revenues and expenses is called a budget.

For a risk to be insurable it must meet which of the following criteria?

The primary goal of the financial manager is best described by which of the following?

Business loans available from commercial banks with terms generally 5-12 years and secured or unsecured are called which of the following?