Finance 302 Exam with All Correct and
Verified Answers 2026-2027 Updated.
The art and science of managing wealth - Answer finance
Finance is about - Answer making decisions regarding what assets to buy/sell and when to
buy/sell these assets
The Cycle of Money - Answer Financial intermediaries assist in the movement of money, from
the lenders to borrowers and back again
Why does the cycle of money make people better off? - Answer The investor receives their
initial payment with interest. The bank is allowed to lend out money and also receive interest.
The borrower is allowed to receive money they did not have.
What are the players and components in the cycle of money? - Answer Lender/ investor
Bank (financial intermediary)
Borrower
What are the four main areas of finance? - Answer 1. Corporate finance
2. Investments
3. Financial institutions and markets
4. International finance
Financial managment - Answer generally defined as those activities that create or preserve the
economic value of the assets of an individual, small business, or corporation
Chief Financial Officer (CFO) - Answer oversee's all of the company's financial activities, such
as determining the best repayment structure for borrowed funds, which ensures that the
company meets its debt obligations in a timely fashion and still has sufficient cash for its daily
operations
What does a financial manager do? - Answer Has to determine the best repayment structure
for borrowing funds, makes sure that debt obligations are met on time, ensures that sufficient
funds are available for carrying out daily operations.
, What is the goal of the financial manager? - Answer Their goal is to make investment and
financing decisions that increase the cash flow of the firm, thereby maximizing the current stock
price
What are the three main functions of a financial manager? - Answer 1. Capital budgeting
2. Capital structure
3. Working capital mangement
Capital budgeting - Answer the process of planning, evaluating, comparing, and selecting the
long-term operating projects of a company. This answers the question, "What business should
we be in over the long term"?
Capital structure - Answer the means by which a company finances its business activities; for
public companies, usually a mix of bonds (debt) and stocks (equity) sold to investors and
owners. This answers the question, "Where do we raise the money to conduct our business
activities"?
Working capital management - Answer the process of managing the day-to-day operating
needs of the company through its current assets and current liabilities (we also refer to this as
short-term financing activities of the company). This answers the question, "How will we
manage our day-to-day business needs"?
What is the hierarchy of a company? - Answer 1. CEO
2. Marketing, finance, manufacturing, information systems, and human resources
What three entities are under the CFO? - Answer Treasurer: does a lot of financial
management, capital structuring, and capital budgeting
Controller: handles a lot of the accounting
Investors relation officer
Sole proprietorship - Answer business owned entirely by one individual
Sole proprietorship pros - Answer -Simplest and least complicated business organization with
the least amount of documentation required
-Owner makes all of the decisions and therefore can act quickly without the need to consult
anyone else
Sole proprietorship cons - Answer -Owner pays all of the bills
-Business is limited to the life of the owner
Verified Answers 2026-2027 Updated.
The art and science of managing wealth - Answer finance
Finance is about - Answer making decisions regarding what assets to buy/sell and when to
buy/sell these assets
The Cycle of Money - Answer Financial intermediaries assist in the movement of money, from
the lenders to borrowers and back again
Why does the cycle of money make people better off? - Answer The investor receives their
initial payment with interest. The bank is allowed to lend out money and also receive interest.
The borrower is allowed to receive money they did not have.
What are the players and components in the cycle of money? - Answer Lender/ investor
Bank (financial intermediary)
Borrower
What are the four main areas of finance? - Answer 1. Corporate finance
2. Investments
3. Financial institutions and markets
4. International finance
Financial managment - Answer generally defined as those activities that create or preserve the
economic value of the assets of an individual, small business, or corporation
Chief Financial Officer (CFO) - Answer oversee's all of the company's financial activities, such
as determining the best repayment structure for borrowed funds, which ensures that the
company meets its debt obligations in a timely fashion and still has sufficient cash for its daily
operations
What does a financial manager do? - Answer Has to determine the best repayment structure
for borrowing funds, makes sure that debt obligations are met on time, ensures that sufficient
funds are available for carrying out daily operations.
, What is the goal of the financial manager? - Answer Their goal is to make investment and
financing decisions that increase the cash flow of the firm, thereby maximizing the current stock
price
What are the three main functions of a financial manager? - Answer 1. Capital budgeting
2. Capital structure
3. Working capital mangement
Capital budgeting - Answer the process of planning, evaluating, comparing, and selecting the
long-term operating projects of a company. This answers the question, "What business should
we be in over the long term"?
Capital structure - Answer the means by which a company finances its business activities; for
public companies, usually a mix of bonds (debt) and stocks (equity) sold to investors and
owners. This answers the question, "Where do we raise the money to conduct our business
activities"?
Working capital management - Answer the process of managing the day-to-day operating
needs of the company through its current assets and current liabilities (we also refer to this as
short-term financing activities of the company). This answers the question, "How will we
manage our day-to-day business needs"?
What is the hierarchy of a company? - Answer 1. CEO
2. Marketing, finance, manufacturing, information systems, and human resources
What three entities are under the CFO? - Answer Treasurer: does a lot of financial
management, capital structuring, and capital budgeting
Controller: handles a lot of the accounting
Investors relation officer
Sole proprietorship - Answer business owned entirely by one individual
Sole proprietorship pros - Answer -Simplest and least complicated business organization with
the least amount of documentation required
-Owner makes all of the decisions and therefore can act quickly without the need to consult
anyone else
Sole proprietorship cons - Answer -Owner pays all of the bills
-Business is limited to the life of the owner
