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TEST BANK
Foundations of Financial Management
Stanley B. Block
18th Edition
Chapters 1-21 (Questions with Verified Answers)
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Table of Contents — Foundations of Financial Management
Part 1: Introduction
1. The Goals and Activities of Financial Management
Part 2: Financial Analysis and Planning
2. Review of Accounting
3. Financial Analysis
4. Financial Forecasting
5. Operating and Financial Leverage
Part 3: Working Capital Management
6. Working Capital and the Financing Decision
7. Current Asset Management
8. Sources of Short-Term Financing
Part 4: The Capital Budgeting Process
9. The Time Value of Money
10. Valuation and Rates of Return
11. Cost of Capital
12. The Capital Budgeting Decision
13. Risk and Capital Budgeting
Part 5: Long-Term Financing
14. Capital Markets
15. Investment Banking
16. Long-Term Debt and Lease Financing
17. Common and Preferred Stock Financing
18. Dividend Policy and Retained Earnings
19. Convertibles, Warrants, and Derivatives
Part 6: Expanding the Perspective of Corporate Finance
20. External Growth through Mergers
21. International Financial Management
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Chapter 1 The Goals and Activities of Financial Management
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
Answer: TRUE
Difficulty: 1 Easy
Topic: Introduction to corporate finance
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
Answer: FALSE
Difficulty: 1 Easy
Topic: Financial management decisions
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
3) Financial capital is composed of long-term plant and equipment, as well as other tangible
investments.
Answer: FALSE
Difficulty: 1 Easy
Topic: Introduction to corporate finance
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
4) Real capital is composed of long-term plant and equipment.
Answer: TRUE
Difficulty: 1 Easy
Topic: Introduction to corporate finance
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
, @PROFDOCDIGITALLIBRARIES
and a number of other areas.
Bloom's: Remember
TEST BANK
Foundations of Financial Management
Stanley B. Block
18th Edition
Chapters 1-21 (Questions with Verified Answers)
,@PROFDOCDIGITALLIBRARIES
Table of Contents — Foundations of Financial Management
Part 1: Introduction
1. The Goals and Activities of Financial Management
Part 2: Financial Analysis and Planning
2. Review of Accounting
3. Financial Analysis
4. Financial Forecasting
5. Operating and Financial Leverage
Part 3: Working Capital Management
6. Working Capital and the Financing Decision
7. Current Asset Management
8. Sources of Short-Term Financing
Part 4: The Capital Budgeting Process
9. The Time Value of Money
10. Valuation and Rates of Return
11. Cost of Capital
12. The Capital Budgeting Decision
13. Risk and Capital Budgeting
Part 5: Long-Term Financing
14. Capital Markets
15. Investment Banking
16. Long-Term Debt and Lease Financing
17. Common and Preferred Stock Financing
18. Dividend Policy and Retained Earnings
19. Convertibles, Warrants, and Derivatives
Part 6: Expanding the Perspective of Corporate Finance
20. External Growth through Mergers
21. International Financial Management
,@PROFDOCDIGITALLIBRARIES
Chapter 1 The Goals and Activities of Financial Management
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
Answer: TRUE
Difficulty: 1 Easy
Topic: Introduction to corporate finance
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
Answer: FALSE
Difficulty: 1 Easy
Topic: Financial management decisions
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
3) Financial capital is composed of long-term plant and equipment, as well as other tangible
investments.
Answer: FALSE
Difficulty: 1 Easy
Topic: Introduction to corporate finance
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: Remember
AACSB: Reflective Thinking
Accessibility: Keyboard Navigation
4) Real capital is composed of long-term plant and equipment.
Answer: TRUE
Difficulty: 1 Easy
Topic: Introduction to corporate finance
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
, @PROFDOCDIGITALLIBRARIES
and a number of other areas.
Bloom's: Remember
