Foundations of Financial Management, 17e (Block ss ss ss ss ss
Chapter 1 The Goals and Activities of Financial Management
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1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
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Answer: TRUE s s
Difficulty: 1 Easy
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Topic: Introduction to corporate finance
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Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.
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Bloom's: Remember
AACSB: Reflective Thinking
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Accessibility: Keyboard Navigation ss
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
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Answer: FALSE s s
Difficulty: 1 Easy
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Topic: Financial management decisions ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.
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Bloom's: Remember
AACSB: Reflective Thinking
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Accessibility: Keyboard Navigation ss
3) Financial capital is composed of long-term plant and equipment, as well as other tangible
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investments.
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Answer: FALSE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
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Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
4) Real capital is composed of long-term plant and equipment.
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Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.
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1
Copyright © 2019 McGraw-Hill Education. All rights reserved. ss ss ss ss ss ss ss
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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,Bloom's: Remember
2
Copyright © 2019 McGraw-Hill Education. All rights reserved.
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No reproduction or distribution without the prior written consent of McGraw-Hill Education.
ss ss ss ss ss ss ss ss ss ss ss
,AACSB: Reflective s s Thinking
ss
Accessibility:
ss s s s s Keyboard
Navigation
ss
5) During the 1930s, financial practice revolved around such topics as the preservation of capital,
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maintenance of liquidity, the reorganization of financially troubled corporations, and bankruptcy.
ss ss ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
ss ss ss ss ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
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Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
7) Recently, the emphasis of financial management has been on the relationship between risk and
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return.
ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
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and a number of other areas.; 01-03 The relationship of risk to return is a central focus of finance.
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Bloom's: Understand
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AACSB: Analytical Thinking s s ss
Accessibility:
ss Keyboard s s s s
Navigation
ss
8) The first Nobel Prizes given to finance professors were for their contributions to capital
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structure theory and portfolio theories of risk and return.
ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
3
Copyright © 2019 McGraw-Hill Education. All rights reserved. ss ss ss ss ss ss ss
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
ss ss ss ss ss ss ss ss ss ss ss
, and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
4
Copyright © 2019 McGraw-Hill Education. All rights reserved.
ss ss ss ss ss ss ss
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
ss ss ss ss ss ss ss ss ss ss ss
Chapter 1 The Goals and Activities of Financial Management
ss ss ss ss ss ss ss
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
ss ss ss ss ss ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
ss ss ss ss ss ss ss ss ss ss ss ss ss
Answer: FALSE s s
Difficulty: 1 Easy
ss ss ss
Topic: Financial management decisions ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
3) Financial capital is composed of long-term plant and equipment, as well as other tangible
ss ss ss ss ss ss ss ss ss ss ss ss ss
investments.
ss
Answer: FALSE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
4) Real capital is composed of long-term plant and equipment.
ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
and a number of other areas.
ss ss ss ss ss ss
1
Copyright © 2019 McGraw-Hill Education. All rights reserved. ss ss ss ss ss ss ss
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
ss ss ss ss ss ss ss ss ss ss ss
,Bloom's: Remember
2
Copyright © 2019 McGraw-Hill Education. All rights reserved.
ss ss ss ss ss ss ss
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
ss ss ss ss ss ss ss ss ss ss ss
,AACSB: Reflective s s Thinking
ss
Accessibility:
ss s s s s Keyboard
Navigation
ss
5) During the 1930s, financial practice revolved around such topics as the preservation of capital,
ss ss ss ss ss ss ss ss ss ss ss ss ss
maintenance of liquidity, the reorganization of financially troubled corporations, and bankruptcy.
ss ss ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
ss ss ss ss ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
AACSB: Reflective Thinking
s s s ss
Accessibility: Keyboard Navigation ss
7) Recently, the emphasis of financial management has been on the relationship between risk and
ss ss ss ss ss ss ss ss ss ss ss ss ss
return.
ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss s s ss ss ss ss ss ss ss ss ss
and a number of other areas.; 01-03 The relationship of risk to return is a central focus of finance.
ss ss ss ss ss ss ss ss ss ss ss ss ss ss ss ss ss ss ss
Bloom's: Understand
ss s s
AACSB: Analytical Thinking s s ss
Accessibility:
ss Keyboard s s s s
Navigation
ss
8) The first Nobel Prizes given to finance professors were for their contributions to capital
ss ss ss ss ss ss ss ss ss ss ss ss ss
structure theory and portfolio theories of risk and return.
ss ss ss ss ss ss ss ss ss
Answer: TRUE s s
Difficulty: 1 Easy
ss ss ss
Topic: Introduction to corporate finance
s s s s ss ss ss
Learning Objective: 01-01 The field of finance integrates concepts from economics, accounting,
ss ss ss ss ss ss ss ss ss ss
3
Copyright © 2019 McGraw-Hill Education. All rights reserved. ss ss ss ss ss ss ss
No reproduction or distribution without the prior written consent of McGraw-Hill Education.
ss ss ss ss ss ss ss ss ss ss ss
, and a number of other areas.
ss ss ss ss ss ss
Bloom's: Remember
4
Copyright © 2019 McGraw-Hill Education. All rights reserved.
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No reproduction or distribution without the prior written consent of McGraw-Hill Education.
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