COMPLETE TEST BANK
For Business Finance 11th Edition
By Eddie Mclaney Latest Update Graded A+
, chapter 01 testbank
student:
1. corporate finance can be described as decisions made by:
A. equity market
investors.
B. potential debt
holders.
C. company directors
and management.
D. financial
analysts.
2. in corporate finance, the financing and investment decisions are related to questions concerning:
A. how to generate profits and
expand operations.
B. how to reduce costs
and survive.
C. how to acquire and employ or
invest funds.
D. all of the given
options.
3. corporate decisions include:
A. investment
decisions.
B. financing
decisions.
C. dividend
decisions.
D. all of the given
options.
,4. when formulating financial policy, managers also have to consider the appropriate balance between:
A. receivables
and payables.
B. interim and
final dividends.
C. short-term and medium-
term finance.
D. short-term and long-
term finance.
5. the ultimate objective of investment and financing decisions is to maximise:
A. the number of projects the company is
invested in.
B. the amount added to the value of the
owner's wealth.
C. the salaries of all employees of
the firm.
D. the repayments that are made
of debt.
6. many small service businesses, retail stores and professional practices are operated as:
A. joint
ventures.
B. partnership
s.
C. sole
proprietorships.
D. limited liability
firms.
7. which of the following is not one of the three major types of business structures in australia:
A. dealershi
p.
B. sole
proprietorship.
C. limited
liability
company.
D. partnershi
p.
, 8. the concept of arbitrage involves:
A. buying a share and selling it later when it
increases in value
B. simultaneous transactions in different markets that result in an
immediate risk-free profit.
C. agreeing on a price to buy or sell a security for in
the future.
D. buying a higher quality good for a cheaper price than is offered for a similar
lower quality item.
9. the principle that a dollar is worth more the sooner it is to be received is the:
A. value
principle.
B. value of money
principle.
C. time value of money
principle.
D. fisher
effect.
10. the interest rate quoted in the financial markets for borrowing and lending transactions is the:
A. real interest
rate.
B. prime
lending rate.
C. nominal interest
rate.
D. cash
rate.
11. the concept of market efficiency means that we should expect securities and other assets to be:
A. underpriced given their expected risks
and returns.
B. overpriced given their expected risks
and returns.
C. fairly priced given their expected risks
and returns.
D. none of the given options is correct as prices cannot be
predicted.
For Business Finance 11th Edition
By Eddie Mclaney Latest Update Graded A+
, chapter 01 testbank
student:
1. corporate finance can be described as decisions made by:
A. equity market
investors.
B. potential debt
holders.
C. company directors
and management.
D. financial
analysts.
2. in corporate finance, the financing and investment decisions are related to questions concerning:
A. how to generate profits and
expand operations.
B. how to reduce costs
and survive.
C. how to acquire and employ or
invest funds.
D. all of the given
options.
3. corporate decisions include:
A. investment
decisions.
B. financing
decisions.
C. dividend
decisions.
D. all of the given
options.
,4. when formulating financial policy, managers also have to consider the appropriate balance between:
A. receivables
and payables.
B. interim and
final dividends.
C. short-term and medium-
term finance.
D. short-term and long-
term finance.
5. the ultimate objective of investment and financing decisions is to maximise:
A. the number of projects the company is
invested in.
B. the amount added to the value of the
owner's wealth.
C. the salaries of all employees of
the firm.
D. the repayments that are made
of debt.
6. many small service businesses, retail stores and professional practices are operated as:
A. joint
ventures.
B. partnership
s.
C. sole
proprietorships.
D. limited liability
firms.
7. which of the following is not one of the three major types of business structures in australia:
A. dealershi
p.
B. sole
proprietorship.
C. limited
liability
company.
D. partnershi
p.
, 8. the concept of arbitrage involves:
A. buying a share and selling it later when it
increases in value
B. simultaneous transactions in different markets that result in an
immediate risk-free profit.
C. agreeing on a price to buy or sell a security for in
the future.
D. buying a higher quality good for a cheaper price than is offered for a similar
lower quality item.
9. the principle that a dollar is worth more the sooner it is to be received is the:
A. value
principle.
B. value of money
principle.
C. time value of money
principle.
D. fisher
effect.
10. the interest rate quoted in the financial markets for borrowing and lending transactions is the:
A. real interest
rate.
B. prime
lending rate.
C. nominal interest
rate.
D. cash
rate.
11. the concept of market efficiency means that we should expect securities and other assets to be:
A. underpriced given their expected risks
and returns.
B. overpriced given their expected risks
and returns.
C. fairly priced given their expected risks
and returns.
D. none of the given options is correct as prices cannot be
predicted.
