TEST BANK
Fundamentals of Corporate Finance, 5th Edition
by Robert Parrino, David Kidwell, All Chapters 1 - 21
1
,2
, Chapter 1 The Financial Manager and the Firm
1) The financial manager is responsible for making decisions that are in the best interests of
the firm's owners.
Answer: TRUE Diff:
1
Learning Objective: LO 1
Bloomcode: Knowledge AACSB:
Analytic
IMA: FSA
AICPA: Process and Resource Management Perspectives
2) A patent is a productive asset for a technology-based
firm. Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge AACSB:
Analytic
IMA: Business Economics
AICPA: Global and Industry Perspectives
3) Intangible assets generate most of a manufacturing firm's cash
flows. Answer: FALSE
Diff: 2
Learning Objective: LO 1
Bloomcode: Application AACSB:
Analytic
IMA: Corporate Finance
AICPA: Process and Resource Management Perspectives
4) The most fundamental way a business can grow in size is by reinvesting cash flows or
earnings. Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge AACSB:
Analytic
IMA: FSA
AICPA: Process and Resource Management Perspectives
3
Fundamentals of Corporate Finance, 5th Edition
by Robert Parrino, David Kidwell, All Chapters 1 - 21
1
,2
, Chapter 1 The Financial Manager and the Firm
1) The financial manager is responsible for making decisions that are in the best interests of
the firm's owners.
Answer: TRUE Diff:
1
Learning Objective: LO 1
Bloomcode: Knowledge AACSB:
Analytic
IMA: FSA
AICPA: Process and Resource Management Perspectives
2) A patent is a productive asset for a technology-based
firm. Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge AACSB:
Analytic
IMA: Business Economics
AICPA: Global and Industry Perspectives
3) Intangible assets generate most of a manufacturing firm's cash
flows. Answer: FALSE
Diff: 2
Learning Objective: LO 1
Bloomcode: Application AACSB:
Analytic
IMA: Corporate Finance
AICPA: Process and Resource Management Perspectives
4) The most fundamental way a business can grow in size is by reinvesting cash flows or
earnings. Answer: TRUE
Diff: 1
Learning Objective: LO 1
Bloomcode: Knowledge AACSB:
Analytic
IMA: FSA
AICPA: Process and Resource Management Perspectives
3
