ii1
8thi EditionibyiStanleyiBlock,iGeoffreyiHirt,iBartleyi
iiD
anielsen|iiVerifiediChapter'si1i–i21
, TABLEiOFiCONTENTS
PARTi1iINTRODUCTION
1 TheiGoalsiandiActivitiesiofiFinancialiManagementiPARTi2iFINANCIALiANALYSIS
i ANDiPLANNING
2 ReviewiofiAccounting
i 3iFinancialiAnalysis
4 FinancialiForecasting
5 OperatingiandiFinancialiLeverage
PARTi3iWORKINGiCAPITALiMANAGEMENT
6 WorkingiCapitalianditheiFinancingiDecision
i 7iCurrentiAssetiManagement
8 SourcesiofiShort-TermiFinancing
PARTi4iTHEiCAPITALiBUDGETINGiPROCESS
9 TheiTimeiValueiofiMoney
10 ValuationiandiRatesiofiReturn
i 11iCostiofiCapital
12iTheiCapitaliBudgetingiDecisioni
13iRiskiandiCapitaliBudgetingi PAR
Ti5iLONG-TERMiFINANCING
14 CapitaliMarkets
15 InvestmentiBanking
16 Long-
TermiDebtiandiLeaseiFinancingii 17iCommo
niandiPreferrediStockiFinancingi 18iDivide
ndiPolicyiandiRetainediEarningsi 19iConver
tibles,iWarrants,iandiDerivatives
PARTi6iEXPANDINGiTHEiPERSPECTIVEiOFiCORPORATEiFINANCE
20iExternaliGrowthithroughiMergersi 21
iInternationaliFinancialiManagement
,FoundationsiofiFinancialiManagement,i18ei(Block)
Chapteri1ii TheiGoalsiandiActivitiesiofiFinancialiManagement
1) Asifinanceiemergediasiainewifield,imuchiemphasisiwasiplacedionimergersiandi
acquisitions.
Answer:iTRUEi Diffic
ulty:i1iEasy
Topic:iiIntroductionitoicorporateifinance
LearningiObjective:ii 01-
01iTheifieldiofifinanceiintegratesiconceptsifromieconomics,i accounting,andiainumberiofiot
heriareas.
Bloom's:ii Remember
i AACSB:
Reflectivei
Thinking
Accessibility:ii KeyboardiNavigation
2) Inflationiisiassumeditoibeiaitemporaryiproblemithatidoesinotiaffectifinancialidecisions.i
Answer:iFALSE
Difficulty:i1iEasy
Topic:iii Financialimanagementidecisions
LearningiObjective:ii 01-
01iTheifieldiofifinanceiintegratesiconceptsifromieconomics,i accounting,andiainumberiofiot
heriareas.
Bloom's:ii Remember
i AACSB:
Reflectivei
Thinking
Accessibility:ii KeyboardiNavigation
3) Financialicapitaliisicomposediofilong-
termiplantiandiequipment,iasiwelliasiotheri tangibleinvestments.
Answer:iFALSEi Diffic
ulty:i1iEasy
Topic:iiIntroductionitoicorporateifinance
LearningiObjective:ii 01-
01iTheifieldiofifinanceiintegratesiconceptsifromieconomics,i accounting,andiainumberiofiot
heriareas.
Bloom's:ii Remember
i AACSB: Reflective
, Thinking
Accessibility:ii KeyboardiNavigation
4) Realicapitaliisicomposediofilong-
termiplantiandiequipment.i AACSB: Reflective Thinking
Accessibility:iKeyboardiNavigation
5) Duringithei1930s,ifinancialipracticeirevolvediaroundisuchitopicsiasitheipreservationiofi
capital,maintenanceiofiliquidity,itheireorganizationiofifinanciallyitroubledicorporations,i a
ndibankruptcy.
Answer:iTRUEi Diffic
ulty:i1iEasy
Topic:iiIntroductionitoicorporateifinance
LearningiObjective:ii 01-
01iTheifieldiofifinanceiintegratesiconceptsifromieconomics,i accounting,andiainumberiofiot
heriareas.
Bloom's:ii Remember
i AACSB:
Reflectivei
Thinking
Accessibility:ii KeyboardiNavigation
6) Initheimidi1950s,ifinanceibeganitoichangeitoiaimoreianalytical,idecision-
orientedi approach.
Answer:iTRUEi Diffic
ulty:i1iEasy
Topic:iiIntroductionitoicorporateifinance
LearningiObjective:ii 01-
01iTheifieldiofifinanceiintegratesiconceptsifromieconomics,i accounting,andiainumberiofiot
heriareas.
Bloom's:ii Remember
i AACSB:
Reflectivei
Thinking
Accessibility:ii KeyboardiNavigation
7) Recently,itheiemphasisiofifinancialimanagementihasibeenionitheirelationshipibetweeni
riskiandreturn.
Answer:iTRUEi Diffic
ulty:i1iEasy
Topic:iiIntroductionitoicorporateifinance