AGEC 4040 Final Exam Study Guide – Practice Questions, Flashcards &
Comprehensive Review
Finance can be defined as... - correct answer ✔✔...the art and science of managing money.
The key role of the financial manager is... - correct answer ✔✔...decision making.
All of the following are sources of funds for the Farm Credit Banks EXCEPT... - correct answer
✔✔...trade credit.
If a young, beginning farmer is willing to accept supervision and guidance in his activities,
he/she is most likely to be able to get credit from... - correct answer ✔✔...the Farm Service
Agency.
The future value of $100 received today and deposited at 6 percent for four years is... - correct
answer ✔✔...$126.
Combining two negatively correlated assets to reduce risk is known as... - correct answer
✔✔...diversification.
A college received a contribution to its endowment fund of $2 million. They can never touch the
principal, but they can use the earnings. At an assumed interest rate of 9.5 percent, how much
can the college earn to help its operations each year? (hint: this is a perpetuity) - correct answer
✔✔$190,000
The agency problem may result from a manager's concerns about any of the following EXCEPT...
- correct answer ✔✔...corporate goals.
Comprehensive Review
Finance can be defined as... - correct answer ✔✔...the art and science of managing money.
The key role of the financial manager is... - correct answer ✔✔...decision making.
All of the following are sources of funds for the Farm Credit Banks EXCEPT... - correct answer
✔✔...trade credit.
If a young, beginning farmer is willing to accept supervision and guidance in his activities,
he/she is most likely to be able to get credit from... - correct answer ✔✔...the Farm Service
Agency.
The future value of $100 received today and deposited at 6 percent for four years is... - correct
answer ✔✔...$126.
Combining two negatively correlated assets to reduce risk is known as... - correct answer
✔✔...diversification.
A college received a contribution to its endowment fund of $2 million. They can never touch the
principal, but they can use the earnings. At an assumed interest rate of 9.5 percent, how much
can the college earn to help its operations each year? (hint: this is a perpetuity) - correct answer
✔✔$190,000
The agency problem may result from a manager's concerns about any of the following EXCEPT...
- correct answer ✔✔...corporate goals.
