FIN 320 FINAL EXAM QUESTIONS &
ANSWERS PASSED ALREADY
GRADED A+
The mixture of debt and equity used to finance a firms operations is called: - Correct
Answer ✔✔ Capital Structure
Which of the following is not a type of agency cost? - Correct Answer ✔✔ The cost of
financing the firm.
Define the Agency Problem: - Correct Answer ✔✔ Conflict of interests between the
owners and managers of a firm.
Increase of which of the following will decrease the Operating Cash Flow? - Correct
Answer ✔✔ Taxes Paid.
Define OCF - Correct Answer ✔✔ Cash generated from a firms normal business
activities
An increase in Net Working Capital is: - Correct Answer ✔✔ a cash inflow for the firm
Define Net Working Capital: - Correct Answer ✔✔ Current Assets less Current
Liabilities
An American dollar deposited in a London bank is a: - Correct Answer ✔✔ Eurodollar
deposit
Define Eurocurrency: - Correct Answer ✔✔ Money deposited in a financial center
outside of the country whose currency is involved.
Which of the following will increase the length of a firms cash cycle? - Correct Answer
✔✔ Accounts Recieveable period increase & Accounts Payable Turn Over increase
Sustainable growth will decrease with increases in: - Correct Answer ✔✔ Dividend
payouts
Define Sustainable Growth Rate: - Correct Answer ✔✔ The maximum possible growth
rate a firm can achieve without external equity financing while retaining a constant debt-
equity ratio.
Which of the following is a source of cash? - Correct Answer ✔✔ Collecting Accounts
Receivable
ANSWERS PASSED ALREADY
GRADED A+
The mixture of debt and equity used to finance a firms operations is called: - Correct
Answer ✔✔ Capital Structure
Which of the following is not a type of agency cost? - Correct Answer ✔✔ The cost of
financing the firm.
Define the Agency Problem: - Correct Answer ✔✔ Conflict of interests between the
owners and managers of a firm.
Increase of which of the following will decrease the Operating Cash Flow? - Correct
Answer ✔✔ Taxes Paid.
Define OCF - Correct Answer ✔✔ Cash generated from a firms normal business
activities
An increase in Net Working Capital is: - Correct Answer ✔✔ a cash inflow for the firm
Define Net Working Capital: - Correct Answer ✔✔ Current Assets less Current
Liabilities
An American dollar deposited in a London bank is a: - Correct Answer ✔✔ Eurodollar
deposit
Define Eurocurrency: - Correct Answer ✔✔ Money deposited in a financial center
outside of the country whose currency is involved.
Which of the following will increase the length of a firms cash cycle? - Correct Answer
✔✔ Accounts Recieveable period increase & Accounts Payable Turn Over increase
Sustainable growth will decrease with increases in: - Correct Answer ✔✔ Dividend
payouts
Define Sustainable Growth Rate: - Correct Answer ✔✔ The maximum possible growth
rate a firm can achieve without external equity financing while retaining a constant debt-
equity ratio.
Which of the following is a source of cash? - Correct Answer ✔✔ Collecting Accounts
Receivable
