Test Bank Fundamentals of Corporate Finance, 11th Edition by Richard Brealey, Stewart Myers, Alan Marcus.

ACCESS Test Bank for Fundamentals of Corporate Finance 11th EditionBreal
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Fundamentals of Corporate Finance Edition 11 Brealey
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CORRECT ANSWERS ARE LOCATED IN THE 2ND HALF OF THIS DOC.
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TRUE/FALSEc-cWritec'T'cifcthecstatementcisctruecandc'F'cifcthecstatementciscfalse.
1) Thecliabilitycofcsolecproprietorscisclimitedctocthecamountcofctheircinvestmentcinctheccompany.
⊚c true
⊚c false

2) Generalcpartnerschaveclimitedcpersonalcliabilitycforcbusinesscdebtscincaclimitedcpartnership.
⊚c true
⊚c false

3) Thecseparationcofcownershipcandcmanagementcisconecdistinctivecfeaturecofccorporations.
⊚c true
⊚c false

4) Acmajorcdisadvantagecofcpartnershipsciscthatctheychavecdoublectaxationcofcprofits.
⊚c true
⊚c false

5) Financialcassetschavecvaluecbecausectheycarecclaimsconcthecfirm'screalcassetscandctheccashcthatcth
osecassetscwillcproduce.
⊚c true
⊚c false

6) Capitalcbudgetingcdecisionscarecusedctocdeterminechowctocraisectheccashcnecessarycforcin
vestments.
⊚c true
⊚c false

7) Acsuccessfulcinvestmentcisconecthatcincreasescthecvaluecofcthecfirm.
⊚c true
⊚c false

8) Facebook'scdecisionctocspendc$700cmillionctocacquirecInstagramciscancinvestmentcdecision.
⊚c true
⊚c false

9) Boardscofcdirectorscarecgenerallycappointedcbycthecfirm'scseniorcofficers.
⊚c true
⊚c false




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,ACCESS Test Bank for Fundamentals of Corporate Finance 11th EditionBreal
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ey
Fundamentals of Corporate Finance Edition 11 Brealey
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10) Financialcanalystscarecinvolvedcincmonitoringcthecriskcassociatedcwithcinvestmentcprojectscandcfi
nancingcdecisions.
⊚c true
⊚c false

11) Thecprimarycgoalcofcanyccompanycshouldcbectocmaximizeccurrentcperiodcprofits.
⊚c true
⊚c false

12) Maximizingcprofitsciscthecsamecascmaximizingcthecvaluecofcthecfirm.
⊚c true
⊚c false

13) ThecDodd-
Frankcfinancialcreformclawcinc2010cgrantedcshareholderscacbindingcvoteconcexecutivecco
mpensation.
⊚c true
⊚c false

14) Solecproprietorshipscfacecthecsamecagencycproblemscascthosecassociatedcwithccorporations.
⊚c true
⊚c false

15) Realcassetsccancbecintangiblecassets.
⊚c true
⊚c false

16) Makingcgoodcinvestmentcandcfinancingcdecisionsciscthecchiefctaskcofcthecfinancialcmanager.
⊚c true
⊚c false

17) Ifcacproject'scvaluecisclesscthancitscrequiredcinvestment,cthencthecprojectciscfinanciallycat
tractive.
⊚c true
⊚c false

18) GlaxoSmithKline'scspendingcofc$3.6cbillionconcresearchcandcdevelopmentcofcnewcdrugsciscacca
pitalcbudgetingcdecisioncbutcnotcacfinancingcdecision.
⊚c true
⊚c false




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, ACCESS Test Bank for Fundamentals of Corporate Finance 11th EditionBreal
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ey
Fundamentals of Corporate Finance Edition 11 Brealey
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19) Deltas'scissuancecofcac$1.0cbillioncbondciscacfinancingcdecision.
⊚c true
⊚c false

20) AncIOUc("Icowecyou")cfromcyourcbrother-in-lawciscacfinancialcasset.
⊚c true
⊚c false

21) Thecseparationcofcownershipcandcmanagementcisconecdistinctivecfeaturecofcbothccorporationsca
ndcsolecproprietors.
⊚c true
⊚c false

22) Shareholderscwelcomechighercshort-termcprofitscevencwhenctheycdamageclong-termcprofits.
⊚c true
⊚c false

23) Acwell-
designedccompensationcpackageccanchelpcacfirmcachievecitscgoalcofcmaximizingcmarketcv
alue.
⊚c true
⊚c false

24) WhileccontrolcofclargecpublicccompaniescincthecUnitedcStatesciscexercisedcthroughcthecboardcofc
directorscandcpressurecfromcthecstockcmarket;cincmanycotherccountriescthecstockcmarketcisclessci
mportantcandccontrolcshiftsctocmajorcstockholders,ctypicallycbankscandcotherccompanies.
⊚c true
⊚c false

25) Corporatecinvestorscarecresponsiblecforcdecidingcwhetherctocreinvestcincthecfirm’scoperationscor
takecthecprofitscascacdistribution.
c


⊚c true
⊚c false

26) Establishedcfirmsccanccreatecvaluecbycdevelopingclong-
termcrelationshipscandcmaintainingcacgoodcreputation.
⊚c true
⊚c false




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