Exam 9: Finance: Acquiring and Using Funds to Maximize Value

What role does a factor play in providing short-term financing to a firm? Why would firms that rely heavily on credit sales find factoring attractive?

When customers of an equipment manufacturing unit buy equipment on credit and then delay making payments, they receive a bill from a collection agency. What relationship does the collection agency have with the manufacturer?

In financial management, risk is referred to as the:

Which of the following is uncharacteristic of a capital budgeting proposal evaluation process?

Which of the following best explains the time value of money?

Which of the following statements is true of angel investors?

Which of the following is a characteristic of debt financing?

Financial capital refers to the:

Define net present value (NPV)and describe how it is used to evaluate capital budgeting proposals.

Benny-Duke Inc.reported a net income of $7 million but paid no dividends to its shareholders. The shareholders should sue the company for failure to provide a return on their equity investment.

Projects with the potential for high returns generally have a low degree of uncertainty and risk.

_____ are very safe and highly liquid assets that firms list with their cash holdings on their balance sheet.