FNCE EXAM 1 ATTACHED WITH THE
CORRECT SOLUTIONS
What cresult cshould cyou cexpect cfrom cfirms cthat cmake cwise cfinancial cdecisions?
Multiple cchoice cquestion.
You cshould cexpect cfirms cto cdecrease ctheir clevel cof coutput.
You cshould cexpect cthe cwealth cof cindividuals cto cincrease cin cthe cfuture.
You cshould cexpect cthe ceconomy cto cremain cstable cover ctime.
You cshould cexpect cinvestors cto close ctheir cexcess cfunds. c- cCORRECT✅✅You
cshould cexpect cthe cwealth cof cindividuals cto cincrease cin cthe cfuture.
Which cgroup chas cindividual cinvestors cas cparticipants cand cis ca clender cof cfunds cto
cthe cfinancial cmarkets?
Multiple cchoice cquestion.
People cwith cideas cand cno cmoney clend cfunds cto cthe cfinancial cmarkets.
People cwith cboth cmoney cand cideas clend cfunds cto cthe cfinancial cmarkets.
People cwith cmoney cand cno cideas clend cfunds cto cthe cfinancial cmarkets.
People cwith cno cideas cand cno cmoney clend cfunds cto cthe cfinancial cmarkets. c-
cCORRECT✅✅People cwith cmoney cand cno cideas clend cfunds cto cthe cfinancial
cmarkets.
Which cof cthese ccorrectly cdefines ca crole cof cinvestments?
Investments care cconcerned cwith cwhich coperations cshould cbe cconducted coverseas.
Investments caddresses cwhich cprojects ca cfirm cshould cfinance.:
Investments caddress cthe ctiming cof ccash cflows cmost cdesired cby cinvestors.
Investments care cconcerned cwith chelping cbanks cdetermine cthe camount cof ccapital
cthey ccan clend.
Investments caddress cthe ctiming cof ccash cflows cmost cdesired cby cinvestors. c-
cCORRECT✅✅Investments caddress cthe ctiming cof ccash cflows cmost cdesired cby
cinvestors.
How cis crisk cdefined?
Multiple cchoice cquestion.
Risk cis cthe cprobability cthat can casset cwill cincrease cin cvalue.
Risk cis ca cpotential cfuture cnegative cimpact cto cvalue cand/or ccash cflows.
Risk cis cthe ccertainty cthat ca ccertain ccash cflow cwill coccur cas cpredicted.
Risk cis cany cevent cthat cincreases can cexpected cfuture ccash cflow. c-
cCORRECT✅✅Risk cis ca cpotential cfuture cnegative cimpact cto cvalue cand/or ccash
cflows.
Which cof cthese cprovides cthe cbest cdescription cof cthe cdifference cbetween caccounting
cand cfinance?
Multiple cchoice cquestion.
,Finance cis cthe crecording cof caccounting ctransactions cthat chave coccurred cor care
cexpected cto coccur.
Accounting cand cfinance care cinterchangeable cterms cwhich chave cthe csame cmeaning
cand capplication.
Accounting crecords cpast cactivities cof ca cfirm cwhile cfinance chelps cwith cdecisions
cregarding cthe cfirm's cfuture.
Accounting cis ccentered con ccurrent cand cfuture cactivities cwhile cfinance cfocuses con
cthe canalysis cof cpast ctransactions. c- cCORRECT✅✅Accounting crecords cpast
cactivities cof ca cfirm cwhile cfinance chelps cwith cdecisions cregarding cthe cfirm's cfuture.
True cor cfalse: cManagerial cfinance chelps cmanagers cmake cdecisions crelated cto ccash
cmanagement, ccapital cinvestments, cand crisk creduction.
True cfalse cquestion.TrueFalse c- cCORRECT✅✅True
Select call cthat capply
Which cof cthe cfollowing care cfinance cfunctions cthat cfall cunder cthe csupervision cof cthe
ctreasurer?
Multiple cselect cquestion.
Interest crate chedging
Managing ccash
Managing ctaxes
Capital cspending c- cCORRECT✅✅Interest crate chedging
Managing ccash
Capital cspending
Which cone cof cthe cfollowing cstatements ccorrectly cidentifies ca cgroup cthat csupplies
cmoney cto cthe cfinancial cmarkets?
Multiple cchoice cquestion.
Banks cprovide cmoney cto cthe cfinancial cmarkets.
The cresearch cand cdevelopment cdepartments cof cmajor ccorporations cprovide cmoney
cto cthe cfinancial cmarkets.
Young, cstart-up cfirms cprovide cmoney cto cthe cfinancial cmarkets.
Individuals csaving cfor cretirement cprovide cmoney cto cthe cfinancial cmarkets. c-
cCORRECT✅✅Individuals csaving cfor cretirement cprovide cmoney cto cthe cfinancial
cmarkets.
Which cof cthese cis can cexample cof ca cpersonal cfinancial cdecision?
Multiple cchoice cquestion.
Faith cdecided cto cwatch cTV crather cthan cone cof cthe cDVDs cshe cowns.
Tom cdecided cto cspend chis cSaturday ccleaning cout chis cgarage crather cthan cplanting
chis cgarden.
Sue copted cto cincrease cher ccompany cretirement cplan ccontribution cto c6 cpercent cof
cher csalary.
Tami cdecided cto corder cher cnew ccar cin cred crather cthan cin cblue. c-
cCORRECT✅✅Sue copted cto cincrease cher ccompany cretirement cplan ccontribution
cto c6 cpercent cof cher csalary.
, Which cone cof cthese cis can cinvestments cactivity?
Multiple cchoice cquestion.
Kristie cpays c$200 ca cmonth con cher ccredit ccard.
Kate cpays c$800 ca cmonth cfor cfood.
Sue chas c$200 ca cmonth cdeposited cinto ca cstock cmutual cfund.
Mark cspent c$800 con ca cnew cTV. c- cCORRECT✅✅Sue chas c$200 ca cmonth
cdeposited cinto ca cstock cmutual cfund.
What cis cthe cdefinition cof ca csole cproprietorship?
Multiple cchoice cquestion.
A csole cproprietorship cis cowned cby ca csingle cindividual cbut cis cfinanced cby ca cventure
ccapitalist.
A csole cproprietorship cis cowned cby ca csingle cindividual cwhose cpersonal cassets care
clegally cseparated cfrom cthe cbusiness cassets.
A csole cproprietorship cis cowned cby ca csingle cindividual cwho cenjoys climited cliability.
A csole cproprietorship cis ca cbusiness centity cthat cis cnot clegally cseparate cfrom cits
cowner. c- cCORRECT✅✅A csole cproprietorship cis ca cbusiness centity cthat cis cnot
clegally cseparate cfrom cits cowner.
A cdiscussion cof crisk cin cwhich cof cthe cfollowing cterms cbest cserves cas can coverall
cdefinition cof crisk?
Multiple cchoice cquestion.
Risk cis cbest cdefined cin cterms cof cthe cpercentage cof ca cfuture ccash cflow cthat cis
cguaranteed.
Risk cis cbest cdefined cin cterms cof cthe ctiming cof call cexpected cfuture ccash cflows.
Risk cis cbest cdefined cin cterms cof cfuture cexpected crewards.
Risk cis cbest cdefined cin cterms cof cthe cprobability cof ca closs cand cthe cexpected
cmagnitude cof cthat closs. c- cCORRECT✅✅Risk cis cbest cdefined cin cterms cof cthe
cprobability cof ca closs cand cthe cexpected cmagnitude cof cthat closs.
What cis cthe cdefinition cof ca cgeneral cpartnership?
Multiple cchoice cquestion.
A cgeneral cpartnership cinvolves cmultiple cbusiness cowners cwho care ceach cpersonally
cresponsible cfor call cof cthe cpartnership's cdebts.
A cgeneral cpartnership cis cdefined cas ca cbusiness centity cwhere ceach cpartner cowns
can cequal cshare cof cthe cbusiness.
A cgeneral cpartnership cis cjoint cownership cof ca cfirm cwhere ceach cowner cis
cresponsible cfor conly ca cportion cof cthe cpartnership's cdebts.
A cgeneral cpartnership cis cdefined cas cjoint cownership cof ca cfirm cwith csome cpartners
chaving climited cliability cwhile cothers chave cunlimited cliability. c- cCORRECT✅✅A
cgeneral cpartnership cinvolves cmultiple cbusiness cowners cwho care ceach cpersonally
cresponsible cfor call cof cthe cpartnership's cdebts.
True cor cfalse: cFinance cis cmore cconcerned cabout cthe cpast cwhile caccounting cis
cmore cconcerned cabout cthe cfuture.
CORRECT SOLUTIONS
What cresult cshould cyou cexpect cfrom cfirms cthat cmake cwise cfinancial cdecisions?
Multiple cchoice cquestion.
You cshould cexpect cfirms cto cdecrease ctheir clevel cof coutput.
You cshould cexpect cthe cwealth cof cindividuals cto cincrease cin cthe cfuture.
You cshould cexpect cthe ceconomy cto cremain cstable cover ctime.
You cshould cexpect cinvestors cto close ctheir cexcess cfunds. c- cCORRECT✅✅You
cshould cexpect cthe cwealth cof cindividuals cto cincrease cin cthe cfuture.
Which cgroup chas cindividual cinvestors cas cparticipants cand cis ca clender cof cfunds cto
cthe cfinancial cmarkets?
Multiple cchoice cquestion.
People cwith cideas cand cno cmoney clend cfunds cto cthe cfinancial cmarkets.
People cwith cboth cmoney cand cideas clend cfunds cto cthe cfinancial cmarkets.
People cwith cmoney cand cno cideas clend cfunds cto cthe cfinancial cmarkets.
People cwith cno cideas cand cno cmoney clend cfunds cto cthe cfinancial cmarkets. c-
cCORRECT✅✅People cwith cmoney cand cno cideas clend cfunds cto cthe cfinancial
cmarkets.
Which cof cthese ccorrectly cdefines ca crole cof cinvestments?
Investments care cconcerned cwith cwhich coperations cshould cbe cconducted coverseas.
Investments caddresses cwhich cprojects ca cfirm cshould cfinance.:
Investments caddress cthe ctiming cof ccash cflows cmost cdesired cby cinvestors.
Investments care cconcerned cwith chelping cbanks cdetermine cthe camount cof ccapital
cthey ccan clend.
Investments caddress cthe ctiming cof ccash cflows cmost cdesired cby cinvestors. c-
cCORRECT✅✅Investments caddress cthe ctiming cof ccash cflows cmost cdesired cby
cinvestors.
How cis crisk cdefined?
Multiple cchoice cquestion.
Risk cis cthe cprobability cthat can casset cwill cincrease cin cvalue.
Risk cis ca cpotential cfuture cnegative cimpact cto cvalue cand/or ccash cflows.
Risk cis cthe ccertainty cthat ca ccertain ccash cflow cwill coccur cas cpredicted.
Risk cis cany cevent cthat cincreases can cexpected cfuture ccash cflow. c-
cCORRECT✅✅Risk cis ca cpotential cfuture cnegative cimpact cto cvalue cand/or ccash
cflows.
Which cof cthese cprovides cthe cbest cdescription cof cthe cdifference cbetween caccounting
cand cfinance?
Multiple cchoice cquestion.
,Finance cis cthe crecording cof caccounting ctransactions cthat chave coccurred cor care
cexpected cto coccur.
Accounting cand cfinance care cinterchangeable cterms cwhich chave cthe csame cmeaning
cand capplication.
Accounting crecords cpast cactivities cof ca cfirm cwhile cfinance chelps cwith cdecisions
cregarding cthe cfirm's cfuture.
Accounting cis ccentered con ccurrent cand cfuture cactivities cwhile cfinance cfocuses con
cthe canalysis cof cpast ctransactions. c- cCORRECT✅✅Accounting crecords cpast
cactivities cof ca cfirm cwhile cfinance chelps cwith cdecisions cregarding cthe cfirm's cfuture.
True cor cfalse: cManagerial cfinance chelps cmanagers cmake cdecisions crelated cto ccash
cmanagement, ccapital cinvestments, cand crisk creduction.
True cfalse cquestion.TrueFalse c- cCORRECT✅✅True
Select call cthat capply
Which cof cthe cfollowing care cfinance cfunctions cthat cfall cunder cthe csupervision cof cthe
ctreasurer?
Multiple cselect cquestion.
Interest crate chedging
Managing ccash
Managing ctaxes
Capital cspending c- cCORRECT✅✅Interest crate chedging
Managing ccash
Capital cspending
Which cone cof cthe cfollowing cstatements ccorrectly cidentifies ca cgroup cthat csupplies
cmoney cto cthe cfinancial cmarkets?
Multiple cchoice cquestion.
Banks cprovide cmoney cto cthe cfinancial cmarkets.
The cresearch cand cdevelopment cdepartments cof cmajor ccorporations cprovide cmoney
cto cthe cfinancial cmarkets.
Young, cstart-up cfirms cprovide cmoney cto cthe cfinancial cmarkets.
Individuals csaving cfor cretirement cprovide cmoney cto cthe cfinancial cmarkets. c-
cCORRECT✅✅Individuals csaving cfor cretirement cprovide cmoney cto cthe cfinancial
cmarkets.
Which cof cthese cis can cexample cof ca cpersonal cfinancial cdecision?
Multiple cchoice cquestion.
Faith cdecided cto cwatch cTV crather cthan cone cof cthe cDVDs cshe cowns.
Tom cdecided cto cspend chis cSaturday ccleaning cout chis cgarage crather cthan cplanting
chis cgarden.
Sue copted cto cincrease cher ccompany cretirement cplan ccontribution cto c6 cpercent cof
cher csalary.
Tami cdecided cto corder cher cnew ccar cin cred crather cthan cin cblue. c-
cCORRECT✅✅Sue copted cto cincrease cher ccompany cretirement cplan ccontribution
cto c6 cpercent cof cher csalary.
, Which cone cof cthese cis can cinvestments cactivity?
Multiple cchoice cquestion.
Kristie cpays c$200 ca cmonth con cher ccredit ccard.
Kate cpays c$800 ca cmonth cfor cfood.
Sue chas c$200 ca cmonth cdeposited cinto ca cstock cmutual cfund.
Mark cspent c$800 con ca cnew cTV. c- cCORRECT✅✅Sue chas c$200 ca cmonth
cdeposited cinto ca cstock cmutual cfund.
What cis cthe cdefinition cof ca csole cproprietorship?
Multiple cchoice cquestion.
A csole cproprietorship cis cowned cby ca csingle cindividual cbut cis cfinanced cby ca cventure
ccapitalist.
A csole cproprietorship cis cowned cby ca csingle cindividual cwhose cpersonal cassets care
clegally cseparated cfrom cthe cbusiness cassets.
A csole cproprietorship cis cowned cby ca csingle cindividual cwho cenjoys climited cliability.
A csole cproprietorship cis ca cbusiness centity cthat cis cnot clegally cseparate cfrom cits
cowner. c- cCORRECT✅✅A csole cproprietorship cis ca cbusiness centity cthat cis cnot
clegally cseparate cfrom cits cowner.
A cdiscussion cof crisk cin cwhich cof cthe cfollowing cterms cbest cserves cas can coverall
cdefinition cof crisk?
Multiple cchoice cquestion.
Risk cis cbest cdefined cin cterms cof cthe cpercentage cof ca cfuture ccash cflow cthat cis
cguaranteed.
Risk cis cbest cdefined cin cterms cof cthe ctiming cof call cexpected cfuture ccash cflows.
Risk cis cbest cdefined cin cterms cof cfuture cexpected crewards.
Risk cis cbest cdefined cin cterms cof cthe cprobability cof ca closs cand cthe cexpected
cmagnitude cof cthat closs. c- cCORRECT✅✅Risk cis cbest cdefined cin cterms cof cthe
cprobability cof ca closs cand cthe cexpected cmagnitude cof cthat closs.
What cis cthe cdefinition cof ca cgeneral cpartnership?
Multiple cchoice cquestion.
A cgeneral cpartnership cinvolves cmultiple cbusiness cowners cwho care ceach cpersonally
cresponsible cfor call cof cthe cpartnership's cdebts.
A cgeneral cpartnership cis cdefined cas ca cbusiness centity cwhere ceach cpartner cowns
can cequal cshare cof cthe cbusiness.
A cgeneral cpartnership cis cjoint cownership cof ca cfirm cwhere ceach cowner cis
cresponsible cfor conly ca cportion cof cthe cpartnership's cdebts.
A cgeneral cpartnership cis cdefined cas cjoint cownership cof ca cfirm cwith csome cpartners
chaving climited cliability cwhile cothers chave cunlimited cliability. c- cCORRECT✅✅A
cgeneral cpartnership cinvolves cmultiple cbusiness cowners cwho care ceach cpersonally
cresponsible cfor call cof cthe cpartnership's cdebts.
True cor cfalse: cFinance cis cmore cconcerned cabout cthe cpast cwhile caccounting cis
cmore cconcerned cabout cthe cfuture.
