Objective Assessment | Actual Questions
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D076 Finance Skills for Managers| Objective Assessment
, To maximize stock investments To maximize charity donations
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2 of 210
Term
Which action decreases the discretionary financing needed (DFN)?
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Decreasing dividend payout Decreasing the net margin
Decreasing the return on equity Increasing the plowback ratio
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3 of 210
Term
Why would bondholders set bond contracts that are very strict to
deter the company from taking on risky projects?
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, Bondholders seek to encourage Bondholders are primarily
company growth through interested in making sure they
investments. will be paid back.
Bondholders are primarily interested Bondholders focus on influencing
in maximizing returns quickly. company management decisions.
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4 of 210
Term
Which action increases the return on equity of a firm if all else remains
constant?
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Increasing debt financing Reducing dividend payouts
Accepting the investment Decreasing profitability
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5 of 210
, Term
What does the risk-free rate indicate?
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Diminishing marginal utility and
Opportunity cost and externalities
inflation
Future cash flow predictions Inflation and opportunity cost
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6 of 210
Term
What is the primary role of financial institutions?
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To conduct financial
transactions such as To manage government tax policies
investments, loans, and deposits
To oversee corporate mergers and To regulate international trade
acquisitions agreements