Financial Management
Practice 2026-VERSION
WITH LATTEST
QUESTIONS AND
VERIFIED ANSWERS
WITH RATIONELS 100%
CORRECT.
1. What is the primary goal of financial
management?
A. Profit maximization
B. Wealth maximization
,C. Sales maximization
D. Cost minimization
Answer: B
Wealth maximization focuses on
increasing shareholders’ value over time,
considering risk and timing.
2. Which concept reflects the idea that
money today is worth more than in the
future?
A. Risk-return tradeoff
B. Time value of money
C. Liquidity preference
D. Arbitrage
Answer: B
,Money today can be invested to earn
returns, making it more valuable than
the same amount in the future.
3. Present value is best defined as:
A. Value of future cash flows today
B. Future value of current cash
C. Net profit
D. Market value
Answer: A
Present value discounts future cash flows
back to today’s terms.
4. Which is a capital budgeting
technique?
, A. Ratio analysis
B. Net Present Value
C. Break-even analysis
D. Budget variance
Answer: B
NPV evaluates investment profitability by
comparing present value of inflows and
outflows.
5. If NPV > 0, the project should be:
A. Rejected
B. Accepted
C. Ignored
D. Delayed
Practice 2026-VERSION
WITH LATTEST
QUESTIONS AND
VERIFIED ANSWERS
WITH RATIONELS 100%
CORRECT.
1. What is the primary goal of financial
management?
A. Profit maximization
B. Wealth maximization
,C. Sales maximization
D. Cost minimization
Answer: B
Wealth maximization focuses on
increasing shareholders’ value over time,
considering risk and timing.
2. Which concept reflects the idea that
money today is worth more than in the
future?
A. Risk-return tradeoff
B. Time value of money
C. Liquidity preference
D. Arbitrage
Answer: B
,Money today can be invested to earn
returns, making it more valuable than
the same amount in the future.
3. Present value is best defined as:
A. Value of future cash flows today
B. Future value of current cash
C. Net profit
D. Market value
Answer: A
Present value discounts future cash flows
back to today’s terms.
4. Which is a capital budgeting
technique?
, A. Ratio analysis
B. Net Present Value
C. Break-even analysis
D. Budget variance
Answer: B
NPV evaluates investment profitability by
comparing present value of inflows and
outflows.
5. If NPV > 0, the project should be:
A. Rejected
B. Accepted
C. Ignored
D. Delayed
