TEST BANK FOR:
Fundamentals Of Corporate Finance Tenth
Editionby Ross (Author), Westerfield
,CHAPTER 01INTRODUCTION TO CORPORATE FINANCE
True / False Questions
1. In Capital Budgeting, The Financial Manager Tries To Identify Investment
Opportunities Thatare Worth More To The Firm Than They Cost To Acquire.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
2. The Size, Timing And Risk Of Cash Flows Are Important When Evaluating A Capital
Budgetingdecision.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
3. A Capital Expenditure Project Becomes Desirable When The Project Is Worth More To
The Firmthan The Cost To Acquire It.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
For Full Chapters :
1-1
,4. A Capital Expenditure Project Becomes Desirable When The Value Of The Cash Flow
Generatedby The Project Exceeds The Project's Cost.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
5. Capital Structure Determines The Least Expensive Sources Of Funds For The Firm To
Borrow.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
6. Capital Structure Determines How Much Debt The Firm Should Have In Relation To Its
Level Ofequity.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
7. Capital Structure Determines The Level Of Current Assets That Is Required To Maintain
The Firm'soperational Level.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
1-2
, 8. Capital Structure Determines How Much Risk Is Associated With The Future Cash
Flows Of Aproject.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
9. Determining When A Supplier Should Be Paid Is A Capital Structure Decision.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
10. Establishing The Accounts Receivable Policies Is A Capital Structure Decision.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
11. Determining The Amount Of Money To Borrow To Finance A 10-Year Project Is A
Capitalstructure Decision.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
1-3
Fundamentals Of Corporate Finance Tenth
Editionby Ross (Author), Westerfield
,CHAPTER 01INTRODUCTION TO CORPORATE FINANCE
True / False Questions
1. In Capital Budgeting, The Financial Manager Tries To Identify Investment
Opportunities Thatare Worth More To The Firm Than They Cost To Acquire.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Easy
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
2. The Size, Timing And Risk Of Cash Flows Are Important When Evaluating A Capital
Budgetingdecision.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
3. A Capital Expenditure Project Becomes Desirable When The Project Is Worth More To
The Firmthan The Cost To Acquire It.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
For Full Chapters :
1-1
,4. A Capital Expenditure Project Becomes Desirable When The Value Of The Cash Flow
Generatedby The Project Exceeds The Project's Cost.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
5. Capital Structure Determines The Least Expensive Sources Of Funds For The Firm To
Borrow.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
6. Capital Structure Determines How Much Debt The Firm Should Have In Relation To Its
Level Ofequity.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
7. Capital Structure Determines The Level Of Current Assets That Is Required To Maintain
The Firm'soperational Level.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
1-2
, 8. Capital Structure Determines How Much Risk Is Associated With The Future Cash
Flows Of Aproject.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
9. Determining When A Supplier Should Be Paid Is A Capital Structure Decision.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
10. Establishing The Accounts Receivable Policies Is A Capital Structure Decision.
False
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
11. Determining The Amount Of Money To Borrow To Finance A 10-Year Project Is A
Capitalstructure Decision.
True
Accessibility: Keyboard Navigation
Blooms: Remember
Difficulty: Medium
Learning Objective: 01-01 The Basic Types Of Financial Management Decisions And The Role Of The Financial
Manager.Topic: 01-04 Financial Management Decisions
1-3
