Question 1

Secondary markets:

Accepted Answer

A)  allow borrowers to raise long-term funds
B)  facilitate capital-raising in the primary market
C)  allow borrowers to raise short-term funds
D)  do not raise new funds but offer liquidity
E)  facilitate all of the given answersF) A) and B)
G) None of the above

Question 2

Which of the following is an example of a primary market transaction?

Accepted Answer

A)  ANZ bank issues new shares to a large funds manager in a private placement.
B)  The ANZ bank sells 10-year government bonds that have 5 years to maturity.
C)  Mary sells 1000 Qantas shares through her broker.
D)  BHP issues new bonds which will mature in ten years.
E)  Both A and D are primary market transactions.F) None of the above
G) B) and E)

Question 3

Short-term assets and short-term liabilities are referred to as the firm's:

Accepted Answer

A)  cash flow
B)  capital budget
C)  capital structure
D)  working capital
E)  financing mixF) A) and C)
G) B) and D)

Question 4

The top financial officer in a firm is commonly referred to as the:

Accepted Answer

A)  chief financial officer
B)  president of finance
C)  controller
D)  treasurer
E)  finance managerF) None of the above
G) All of the above

Question 5

Which one of the following is most likely to create a situation where an agency conflict could arise?

Accepted Answer

A)  increasing the size of a firm's operations
B)  downsizing a firm
C)  separating management from ownership
D)  decreasing employee turnover
E)  reducing both management and non-management salariesF) B) and E)
G) A) and B)

Question 6

What is the goal of financial management for a sole proprietorship?

Accepted Answer

A)  Maximise net income given the current resources of the firm.
B)  Decrease long-term debt to reduce the risk to the owner.
C)  Minimise the tax impact on the proprietor.
D)  Maximise the market value of the equity.
E)  Minimise the reliance on fixed costs.F) B) and C)
G) A) and E)

Question 7

The daily financial operations of a firm are primarily controlled by managing the:

Accepted Answer

A)  total debt level
B)  working capital
C)  capital structure
D)  capital budget
E)  long-term liabilitiesF) C) and D)
G) A) and B)

Question 8

The goal of a financial manager should be:-

Accepted Answer

A)  to maximise next year's profit
B)  to minimise next year's cost
C)  to maximise the value of the existing owners' equity
D)  to take no risks with shareholders' investments
E)  None of these are appropriate goalsF) A) and C)
G) B) and E)

Question 9

A business organisation that is similar to a sole proprietorship but has two or more owners is called a:

Accepted Answer

A)  limited liability company
B)  corporation
C)  dual company
D)  partnership
E)  joint stock companyF) A) and B)
G) A) and C)

Exam 1: Introduction to Financial Management

Which one of the following is most likely to create a situation where an agency conflict could arise?

Correct Answer
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Which of the following is an example of a primary market transaction?

Correct Answer
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Short-term assets and short-term liabilities are referred to as the firm's:

Correct Answer
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The goal of a financial manager should be:-

Correct Answer
verified

The top financial officer in a firm is commonly referred to as the:

Correct Answer
verified

A business organisation that is similar to a sole proprietorship but has two or more owners is called a:

Correct Answer
verified

The daily financial operations of a firm are primarily controlled by managing the:

Correct Answer
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Secondary markets:

Correct Answer
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What is the goal of financial management for a sole proprietorship?

Correct Answer
verified

Exam 1: Introduction to Financial Management

Which one of the following is most likely to create a situation where an agency conflict could arise?

Correct AnswerverifiedShow Answer

Which of the following is an example of a primary market transaction?

Correct AnswerverifiedShow Answer

Short-term assets and short-term liabilities are referred to as the firm's:

Correct AnswerverifiedShow Answer

The goal of a financial manager should be:-

Correct AnswerverifiedShow Answer

The top financial officer in a firm is commonly referred to as the:

Correct AnswerverifiedShow Answer

A business organisation that is similar to a sole proprietorship but has two or more owners is called a:

Correct AnswerverifiedShow Answer

The daily financial operations of a firm are primarily controlled by managing the:

Correct AnswerverifiedShow Answer

Secondary markets:

Correct AnswerverifiedShow Answer

What is the goal of financial management for a sole proprietorship?

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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