Question 1

How could you compensate an investor for taking on a significant amount of risk?

Accepted Answer

A)  Increase the expected rate of return 
B)  Raise more debt capital 
C)  Offer stock at a higher price 
D)  Increase sales 
A)  Increase the expected rate of return 
B)  Raise more debt capital 
C)  Offer stock at a higher price 
D)  Increase sales

Question 2

The Sarbanes-Oxley was passed in

Accepted Answer

A)  1933 to separate commercial banking from investment banking. 
B)  2002 after the ENRON bankruptcy exposed unethical behavior by the company's executives and accountants. 
C)  2008 after the collapse of the subprime mortgage market. 
D)  2010 to protect consumers from financial fraud. 
A)  1933 to separate commercial banking from investment banking. 
B)  2002 after the ENRON bankruptcy exposed unethical behavior by the company's executives and accountants. 
C)  2008 after the collapse of the subprime mortgage market. 
D)  2010 to protect consumers from financial fraud.

Question 3

Which one of the following categories of owners enjoys limited liability?

Accepted Answer

A)  General partners in a limited partnership or limited liability company. 
B)  Shareholders (common stock) of a corporation 
C)  Sole proprietors 
D)  Both A and B 
A)  General partners in a limited partnership or limited liability company. 
B)  Shareholders (common stock) of a corporation 
C)  Sole proprietors 
D)  Both A and B

Question 4

In 2016, shares of Chipotle Mexican Grill lost more than half their value after widely reported incidents of customers suffering from food food poisoning after eating at he restaurants. The change in stock price illustrates which principle?

Accepted Answer

A)  Market prices reflect information. 
B)  Individuals respond to incentives. 
C)  Cash flows are the source of value. 
D)  The time-value of money. 
A)  Market prices reflect information. 
B)  Individuals respond to incentives. 
C)  Cash flows are the source of value. 
D)  The time-value of money.

Question 5

Discuss the risk/return tradeoff and how it relates to finance.

Accepted Answer

As people are risk averse, they need a h

Question 6

A limited partner is liable

Accepted Answer

A)  for only his or her own share of the partnership's debts. 
B)  for his or her own share of the partnership's debts and contingently liable for the other partners shares. 
C)  only up to the amount invested by that partner. 
D)  for none of the partnership's debts. 
A)  for only his or her own share of the partnership's debts. 
B)  for his or her own share of the partnership's debts and contingently liable for the other partners shares. 
C)  only up to the amount invested by that partner. 
D)  for none of the partnership's debts.

Question 7

Finance managers need to interact constantly with

Accepted Answer

A)  marketing managers. 
B)  accounting staff. 
C)  management information systems staff. 
D)  all of the above. 
A)  marketing managers. 
B)  accounting staff. 
C)  management information systems staff. 
D)  all of the above.

Question 8

Which of the following is NOT an advantage of the sole proprietorship?

Accepted Answer

A)  Limited liability 
B)  No time limit imposed on its existence 
C)  No legal requirements for starting the business 
D)  None of the above 
A)  Limited liability 
B)  No time limit imposed on its existence 
C)  No legal requirements for starting the business 
D)  None of the above

Question 9

The true owners of the corporation are the

Accepted Answer

A)  holders of debt issues of the firm. 
B)  preferred stockholders. 
C)  board of directors of the firm. 
D)  common stockholders. 
A)  holders of debt issues of the firm. 
B)  preferred stockholders. 
C)  board of directors of the firm. 
D)  common stockholders.

Question 10

For these types of organization, no distinction is made between business and personal assets.

Accepted Answer

A)  Sole proprietorship 
B)  General partnership 
C)  Limited partnership 
D)  Both A and B 
A)  Sole proprietorship 
B)  General partnership 
C)  Limited partnership 
D)  Both A and B

How could you compensate an investor for taking on a significant amount of risk?

The Sarbanes-Oxley was passed in

Which one of the following categories of owners enjoys limited liability?

In 2016, shares of Chipotle Mexican Grill lost more than half their value after widely reported incidents of customers suffering from food food poisoning after eating at he restaurants. The change in stock price illustrates which principle?

Discuss the risk/return tradeoff and how it relates to finance.

A limited partner is liable

Finance managers need to interact constantly with

Which of the following is NOT an advantage of the sole proprietorship?

The true owners of the corporation are the

For these types of organization, no distinction is made between business and personal assets.

Firms and the Financial Market

Understanding Financial Statements, Taxes, and Cash Flows

Financial Analysis-Sizing up Firm Performance

Time Value of Money-The Basics

The Time Value of Money-Annuities and Other Topics

An Introduction to Risk and Return-History of Financial Market Returns

Risk and Return-Capital Market Theory

Debt Valuation and Interest Rates

Stock Valuation

Investment Decision Criteria

Analyzing Project Cash Flows

Risk Analysis and Project Evaluation

The Cost of Capital

Capital Structure Policy

Dividend Policy

Financial Forecasting and Planning

Working Capital Management

International Business Finance

Corporate Risk Management

Filters

Exam 1: Getting Started-Principles of Finance

How could you compensate an investor for taking on a significant amount of risk?

The Sarbanes-Oxley was passed in

Which one of the following categories of owners enjoys limited liability?

In 2016, shares of Chipotle Mexican Grill lost more than half their value after widely reported incidents of customers suffering from food food poisoning after eating at he restaurants. The change in stock price illustrates which principle?

Discuss the risk/return tradeoff and how it relates to finance.

A limited partner is liable

Finance managers need to interact constantly with

Which of the following is NOT an advantage of the sole proprietorship?

The true owners of the corporation are the

For these types of organization, no distinction is made between business and personal assets.

Firms and the Financial Market

Understanding Financial Statements, Taxes, and Cash Flows

Financial Analysis-Sizing up Firm Performance

Time Value of Money-The Basics

The Time Value of Money-Annuities and Other Topics

An Introduction to Risk and Return-History of Financial Market Returns

Risk and Return-Capital Market Theory

Debt Valuation and Interest Rates

Stock Valuation

Investment Decision Criteria

Analyzing Project Cash Flows

Risk Analysis and Project Evaluation

The Cost of Capital

Capital Structure Policy

Dividend Policy

Financial Forecasting and Planning

Working Capital Management

International Business Finance

Corporate Risk Management

Filters