C201 Financial Management EXAM QUESTIONS
AND VERIFIED ANSWERS
financial manager - ANS an executive who develops and implements the firm's financial
plan and determines the most appropriate sources and uses of funds
financial plan - ANS is the document that specifies that funds needed by a firm for the
period of time, the timing of inflows and outflows, and the most appropriate sources and
uses of funds
marketable securities - ANS short-term, low-risk investments that can be easily sold and
converted to cash
private equity funds - ANS investment companies that raise funds from wealthy individuals
and institutional investors and use those funds to make large investments in both public
and privately held companies
leverage - ANS process of increasing the rate of return on funds invested by borrowing
funds
capital structure - ANS the mixture of debt and equity maintained by a firm
dividends - ANS periodic distributions of cash to the stockholders of a firm
trade credit - ANS is extended by suppliers when a firm receives goods of services, agreeing
to pay for them at a later date
equity capital - ANS consists of funds provided by the firm's owners when they reinvest
earnings, make additional contributions, liquidate assets, issue stock to the general public
or raise capital from outside investors
AND VERIFIED ANSWERS
financial manager - ANS an executive who develops and implements the firm's financial
plan and determines the most appropriate sources and uses of funds
financial plan - ANS is the document that specifies that funds needed by a firm for the
period of time, the timing of inflows and outflows, and the most appropriate sources and
uses of funds
marketable securities - ANS short-term, low-risk investments that can be easily sold and
converted to cash
private equity funds - ANS investment companies that raise funds from wealthy individuals
and institutional investors and use those funds to make large investments in both public
and privately held companies
leverage - ANS process of increasing the rate of return on funds invested by borrowing
funds
capital structure - ANS the mixture of debt and equity maintained by a firm
dividends - ANS periodic distributions of cash to the stockholders of a firm
trade credit - ANS is extended by suppliers when a firm receives goods of services, agreeing
to pay for them at a later date
equity capital - ANS consists of funds provided by the firm's owners when they reinvest
earnings, make additional contributions, liquidate assets, issue stock to the general public
or raise capital from outside investors
