TEST BANK
Fundamentals of Corporate Finance
Jonathan Berk, Peter DeMarzo, Jarrad Harford, David Stangeland, Andras Marosi
────────────────────────────────────────────────────
M
5th Canadian Edition
ED
GE
EK
©
20
TEST BANK
26
?
MEDGEEK_STUVIA
, TABLE OF CONTENTS
Test Bank: Fundamentals of Corporate Finance, 5th Canadian Edition
By Berk, DeMarzo, Harford, Stangeland, and Marosi
CHAPTER 1 Corporate Finance and the Financial Manager
CHAPTER 2 Introduction to Financial Statement Analysis
M
CHAPTER 3 The Valuation Principle: The Foundation of Financial Decision Making
CHAPTER 4 The Time Value of Money
CHAPTER 5 Interest Rates
ED
CHAPTER 6 Bonds
CHAPTER 7 Valuing Stocks
CHAPTER 8 Investment Decision Rules
CHAPTER 9 Fundamentals of Capital Budgeting
GE
CHAPTER 10 Risk and Return in Capital Markets
CHAPTER 11 Systematic Risk and the Equity Risk Premium
CHAPTER 12 Determining the Cost of Capital
CHAPTER 13 Risk and the Pricing of Options
EK
CHAPTER 14 Raising Equity Capital
CHAPTER 15 Debt Financing
CHAPTER 16 Capital Structure
CHAPTER 17 Payout Policy
©
CHAPTER 18 Financial Modeling and Pro Forma Analysis
CHAPTER 19 Working Capital Management
CHAPTER 20 Short-Term Financial Planning
20
CHAPTER 21 Risk Management
CHAPTER 22 International Corporate Finance
CHAPTER 23 Leasing
CHAPTER 24 Mergers and Acquisitions
26
CHAPTER 25 Corporate Governance
?
MEDGEEK_STUVIA
,Fundamentals of Corporate Finance, 5Ce (Berk)
Chapter 1 Corporate Finance and the Financial Manager
1.1 Why Study Finance?
1) The Valuation Principle shows how to make the costs and benefits of a decision comparable so that we
can evaluate them properly.
Answer: TRUE
M
Diff: 1 Type: TF
Skill: Conceptual
Objective: 1.1 Grasp the importance of financial information in both your personal and business lives
ED
2) Which of the following best describes why the Valuation Principle is a key concept in making financial
decisions?
A) It shows how to assign monetary value to intangibles such as good health and well-being.
B) It allows fixed assets and liquid assets to be valued correctly.
C) It gives a good indication of the net worth of a person, item, or company and can be used to estimate
G
any changes in that net worth.
D) It shows how to make the costs and benefits of a decision comparable so that we can weigh them
properly.
EE
E) It allows us to produce accurate financial statements.
Answer: D
Diff: 1 Type: MC
Skill: Conceptual
Objective: 1.1 Grasp the importance of financial information in both your personal and business lives
K©
3) Both personal financial decisions and business financial decisions can best be made by applying the:
A) Internal Ranking Criteria.
B) Best Alternatives Matrix.
C) Valuation Principle.
D) Financial Comparison Analysis.
20
E) Law of One Price.
Answer: C
Diff: 1 Type: MC
Skill: Conceptual
Objective: 1.1 Grasp the importance of financial information in both your personal and business lives
26
?
MEDGEEK_STUVIA
, 1.2 The Three Types of Firms
1) Partnerships are the most common type of business firm in the world.
Answer: FALSE
Diff: 1 Type: TF
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
M
2) Corporations have come to dominate the business world through their ability to raise large amounts of
capital by sale of ownership shares to anonymous outside investors.
Answer: TRUE
ED
Diff: 1 Type: TF
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
G
3) Which of the following types of firms do NOT have limited liability?
A) sole proprietorships
B) limited partnerships
EE
C) private corporations
D) public corporations
E) limited liability partnerships
Answer: A
Diff: 1 Type: MC
K©
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
4) Over 60% of all Canadian business profit is generated by which type of firm?
A) sole proprietorships
20
B) partnerships
C) limited partnerships
D) corporations
E) limited liability partnerships
Answer: D
26
Diff: 1 Type: MC
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
?
MEDGEEK_STUVIA
Fundamentals of Corporate Finance
Jonathan Berk, Peter DeMarzo, Jarrad Harford, David Stangeland, Andras Marosi
────────────────────────────────────────────────────
M
5th Canadian Edition
ED
GE
EK
©
20
TEST BANK
26
?
MEDGEEK_STUVIA
, TABLE OF CONTENTS
Test Bank: Fundamentals of Corporate Finance, 5th Canadian Edition
By Berk, DeMarzo, Harford, Stangeland, and Marosi
CHAPTER 1 Corporate Finance and the Financial Manager
CHAPTER 2 Introduction to Financial Statement Analysis
M
CHAPTER 3 The Valuation Principle: The Foundation of Financial Decision Making
CHAPTER 4 The Time Value of Money
CHAPTER 5 Interest Rates
ED
CHAPTER 6 Bonds
CHAPTER 7 Valuing Stocks
CHAPTER 8 Investment Decision Rules
CHAPTER 9 Fundamentals of Capital Budgeting
GE
CHAPTER 10 Risk and Return in Capital Markets
CHAPTER 11 Systematic Risk and the Equity Risk Premium
CHAPTER 12 Determining the Cost of Capital
CHAPTER 13 Risk and the Pricing of Options
EK
CHAPTER 14 Raising Equity Capital
CHAPTER 15 Debt Financing
CHAPTER 16 Capital Structure
CHAPTER 17 Payout Policy
©
CHAPTER 18 Financial Modeling and Pro Forma Analysis
CHAPTER 19 Working Capital Management
CHAPTER 20 Short-Term Financial Planning
20
CHAPTER 21 Risk Management
CHAPTER 22 International Corporate Finance
CHAPTER 23 Leasing
CHAPTER 24 Mergers and Acquisitions
26
CHAPTER 25 Corporate Governance
?
MEDGEEK_STUVIA
,Fundamentals of Corporate Finance, 5Ce (Berk)
Chapter 1 Corporate Finance and the Financial Manager
1.1 Why Study Finance?
1) The Valuation Principle shows how to make the costs and benefits of a decision comparable so that we
can evaluate them properly.
Answer: TRUE
M
Diff: 1 Type: TF
Skill: Conceptual
Objective: 1.1 Grasp the importance of financial information in both your personal and business lives
ED
2) Which of the following best describes why the Valuation Principle is a key concept in making financial
decisions?
A) It shows how to assign monetary value to intangibles such as good health and well-being.
B) It allows fixed assets and liquid assets to be valued correctly.
C) It gives a good indication of the net worth of a person, item, or company and can be used to estimate
G
any changes in that net worth.
D) It shows how to make the costs and benefits of a decision comparable so that we can weigh them
properly.
EE
E) It allows us to produce accurate financial statements.
Answer: D
Diff: 1 Type: MC
Skill: Conceptual
Objective: 1.1 Grasp the importance of financial information in both your personal and business lives
K©
3) Both personal financial decisions and business financial decisions can best be made by applying the:
A) Internal Ranking Criteria.
B) Best Alternatives Matrix.
C) Valuation Principle.
D) Financial Comparison Analysis.
20
E) Law of One Price.
Answer: C
Diff: 1 Type: MC
Skill: Conceptual
Objective: 1.1 Grasp the importance of financial information in both your personal and business lives
26
?
MEDGEEK_STUVIA
, 1.2 The Three Types of Firms
1) Partnerships are the most common type of business firm in the world.
Answer: FALSE
Diff: 1 Type: TF
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
M
2) Corporations have come to dominate the business world through their ability to raise large amounts of
capital by sale of ownership shares to anonymous outside investors.
Answer: TRUE
ED
Diff: 1 Type: TF
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
G
3) Which of the following types of firms do NOT have limited liability?
A) sole proprietorships
B) limited partnerships
EE
C) private corporations
D) public corporations
E) limited liability partnerships
Answer: A
Diff: 1 Type: MC
K©
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
4) Over 60% of all Canadian business profit is generated by which type of firm?
A) sole proprietorships
20
B) partnerships
C) limited partnerships
D) corporations
E) limited liability partnerships
Answer: D
26
Diff: 1 Type: MC
Skill: Conceptual
Objective: 1.2 Understand the important features of the three main types of firms and see why the
advantages of the corporate form have led it to dominate economic activity
?
MEDGEEK_STUVIA
