Exam 20: Financial Decisions and Risk Management

The two primary sources for obtaining long-term borrowing from outside the business firm are the issuance of commercial paper and factoring of accounts receivable.

Clarence is a factor who has just bought $40 000 worth of finished goods for $24 000.The profit that he will make on this transaction depends on

Rosella is financial manager who is comparing the effects of debt and equity financing.She finds that

List four sources of short-term funds.

Excel Corp.has a long-term loan with a bank at 1 percent above prime.This is an example of a fixed loan rate.

For most companies,the largest single category of a firm's short-term debt is

Which of the following is the riskiest mix of long-term funding?

Sources of short-term funds include all of the following except

The overall objective of the financial manager is to invest the firm's money wisely.

Conserving a firm's financial assets by minimizing the financial effect of accidental losses is risk management.

David is in the process of checking actual performance against plans to ensure that the desired financial outcome occurs.David is involved in

Which of the following represents the reason that insurance companies are willing to assume the risk of certain potentially devastating losses for other companies?

Generally speaking,what is the best approach to use when coping with potential losses?

Jack is setting up a global operation.The form of trade credit that is particularly useful for Jack's international transactions would be

What is the major source of long-term debt financing for most corporations?

What is commercial paper?

Bake-Loc is considering issuing corporate bonds in order to raise money.If the following facts are known,which one would strengthen the case for issuing bonds?

John is in the process of implementing a risk-management program for his company.He has already identified risks and potential losses.His next step is to

Junk bonds are so called because they pay unattractive interest rates to holders.

When a delivery service trains its drivers in defensive-driving techniques and maintains their trucks in good working order,it is practising risk avoidance.