1
Copyright © 2019 McGraw-Hill Education. All rights reserved.
p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
,Foundations of Financial Management, 18e (Block) p! p! p! p! p!
Chapter 1 The Goals and Activities of Financial Management
p! p! p! p! p! p! p!
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
p! p! p! p! p! p! p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
p! p! p! p! p! p! p! p! p! p! p! p! p!
Answer: FALSE Di p ! p!
fficulty: 1 Easy p! p!
Topic: Financial management decisions p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
3) Financial capital is composed of long- p! p! p! p! p!
term plant and equipment, as well as other tangible investments.
p! p! p! p! p! p! p! p! p!
Answer: FALSE Di p ! p!
fficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
4) Real capital is composed of long-term plant and equipment.
p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
2
Copyright © 2019 McGraw-Hill Education. All rights reserved. p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
,ficulty: 1 Easy
p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01-
p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's: Remember
3
Copyright © 2019 McGraw-Hill Education. All rights reserved.
p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
, AACSB: Reflective Thinking Acce
p ! p! p!
ssibility: Keyboard Navigation
p! p! p!
5) During the 1930s, financial practice revolved around such topics as the preservation of capital,
p! p! p! p! p! p! p! p! p! p! p! p! p!
p!maintenance of liquidity, the reorganization of financially troubled corporations, and bankruptcy
p! p! p! p! p! p! p! p! p! p!
.
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
p! p! p! p! p! p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
7) Recently, the emphasis of financial management has been on the relationship between risk and
p! p! p! p! p! p! p! p! p! p! p! p! p!
return.
p!
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p! p !
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.; 01-03 The relationship of risk to return is a central focus of finance. Bloom's: Understand
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p !
AACSB: Analytical Thinking Acce
p ! p! p!
ssibility: Keyboard Navigation
p! p! p!
8) The first Nobel Prizes given to finance professors were for their contributions to capital
p! p! p! p! p! p! p! p! p! p! p! p! p!
structure theory and portfolio theories of risk and return.
p! p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
4
Copyright © 2019 McGraw-Hill Education. All rights reserved. p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
Copyright © 2019 McGraw-Hill Education. All rights reserved.
p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
,Foundations of Financial Management, 18e (Block) p! p! p! p! p!
Chapter 1 The Goals and Activities of Financial Management
p! p! p! p! p! p! p!
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
p! p! p! p! p! p! p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
p! p! p! p! p! p! p! p! p! p! p! p! p!
Answer: FALSE Di p ! p!
fficulty: 1 Easy p! p!
Topic: Financial management decisions p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
3) Financial capital is composed of long- p! p! p! p! p!
term plant and equipment, as well as other tangible investments.
p! p! p! p! p! p! p! p! p!
Answer: FALSE Di p ! p!
fficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
4) Real capital is composed of long-term plant and equipment.
p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
2
Copyright © 2019 McGraw-Hill Education. All rights reserved. p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
,ficulty: 1 Easy
p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01-
p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's: Remember
3
Copyright © 2019 McGraw-Hill Education. All rights reserved.
p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
, AACSB: Reflective Thinking Acce
p ! p! p!
ssibility: Keyboard Navigation
p! p! p!
5) During the 1930s, financial practice revolved around such topics as the preservation of capital,
p! p! p! p! p! p! p! p! p! p! p! p! p!
p!maintenance of liquidity, the reorganization of financially troubled corporations, and bankruptcy
p! p! p! p! p! p! p! p! p! p!
.
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
p! p! p! p! p! p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p!
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.
Bloom's:
Remember AACS p !
B: Reflective Thinking !
p p!
Accessibility: Keyboard Navigation p!
7) Recently, the emphasis of financial management has been on the relationship between risk and
p! p! p! p! p! p! p! p! p! p! p! p! p!
return.
p!
Answer: TRUE Dif p ! p!
ficulty: 1 Easy p! p!
Topic: Introduction to corporate finance
p ! p ! p! p! p!
Learning Objective: 01- p! p !
01 The field of finance integrates concepts from economics, accounting, and a number of other ar
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p!
eas.; 01-03 The relationship of risk to return is a central focus of finance. Bloom's: Understand
p! p! p! p! p! p! p! p! p! p! p! p! p! p! p !
AACSB: Analytical Thinking Acce
p ! p! p!
ssibility: Keyboard Navigation
p! p! p!
8) The first Nobel Prizes given to finance professors were for their contributions to capital
p! p! p! p! p! p! p! p! p! p! p! p! p!
structure theory and portfolio theories of risk and return.
p! p! p! p! p! p! p! p! p!
Answer: TRUE Dif p ! p!
4
Copyright © 2019 McGraw-Hill Education. All rights reserved. p! p! p! p! p! p! p!
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
p! p! p! p! p! p! p! p! p! p! p!
