FINC 3610 Final Exam Dismukes NEWEST 2025-2026
COMPLETE QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED
A+||BRAND NEW VERSION!!
capital structure - ANSWER-how do we finance those investments?
working capital structure - ANSWER-how do we manage the day-to-day operation
of the firm?
Forms of business organization - ANSWER-sole proprietorship, partnership,
corporation
sole proprietorship - ANSWER-one single person--> high risk, high reward, unlimited
liability, easy to start-up, taxed as personal income, difficult to transfer ownership
corpo
partnership - ANSWER--general: run the business, making decisions, and accepting
more risk, easy to startup, taxed as personal income
-limited: there for money and investing, limited liability, life limited of that of
owners, equity limited to combined wealth, difficulty transferring ownership
, corporation - ANSWER-a business created as a distinct legal entity composed of one
or more individual entities
-separation of ownership and control
-shareholders: anyone who owns stock in company
-directors: voted on by shareholders (proxy vote), ultimate oversight
-managers: run the company
What is the goal of financial management? - ANSWER-*maximize shareholder
wealth*
Three questions that corporate finance focused on? - ANSWER-1. capital budgeting
2. capital structure
3. working capital management
capital budgeting - ANSWER-what should we invest in long-term?
Agency problem/conflict - ANSWER-The possibility of conflict of interest between the
stockholders (the principal) and management (the agent) of a firm
Financial markets and the corporation - ANSWER-firm: invest in assets, current and
fixed
financial markets: short and long term debt, equity shares
-ultimately the firm must be a cash generating activity
COMPLETE QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS) |ALREADY GRADED
A+||BRAND NEW VERSION!!
capital structure - ANSWER-how do we finance those investments?
working capital structure - ANSWER-how do we manage the day-to-day operation
of the firm?
Forms of business organization - ANSWER-sole proprietorship, partnership,
corporation
sole proprietorship - ANSWER-one single person--> high risk, high reward, unlimited
liability, easy to start-up, taxed as personal income, difficult to transfer ownership
corpo
partnership - ANSWER--general: run the business, making decisions, and accepting
more risk, easy to startup, taxed as personal income
-limited: there for money and investing, limited liability, life limited of that of
owners, equity limited to combined wealth, difficulty transferring ownership
, corporation - ANSWER-a business created as a distinct legal entity composed of one
or more individual entities
-separation of ownership and control
-shareholders: anyone who owns stock in company
-directors: voted on by shareholders (proxy vote), ultimate oversight
-managers: run the company
What is the goal of financial management? - ANSWER-*maximize shareholder
wealth*
Three questions that corporate finance focused on? - ANSWER-1. capital budgeting
2. capital structure
3. working capital management
capital budgeting - ANSWER-what should we invest in long-term?
Agency problem/conflict - ANSWER-The possibility of conflict of interest between the
stockholders (the principal) and management (the agent) of a firm
Financial markets and the corporation - ANSWER-firm: invest in assets, current and
fixed
financial markets: short and long term debt, equity shares
-ultimately the firm must be a cash generating activity
