TEST BANK For Foundations of Financial Management, 18th Edition by Stanley Block, Geoffrey Hirt, Bartley Danielsen| Verified Chapter's 1 - 21 | Complete Newest Version

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Copyright © 2019 McGraw-Hill Education. All rights reserved.
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No reproduction or distribution without the prior written consent of McGraw-
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Hill Education.

,Foundations of Financial Management, 18e (Block)
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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 Diff W W


iculty: 1 EasyW W


Topic: Introduction to corporate finance
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Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.
Bloom's:
Remember AACS W


B: Reflective Thinking
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Accessibility: Keyboard Navigation W




2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
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Answer: FALSE Di W W


fficulty: 1 Easy W W


Topic: Financial management decisions W W


Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.
Bloom's:
Remember AACS W


B: Reflective Thinking
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Accessibility: Keyboard Navigation W




3) Financial capital is composed of long-
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term plant and equipment, as well as other tangible investments.
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Answer: FALSE Di W W


fficulty: 1 Easy W W


Topic: Introduction to corporate finance
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Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.
Bloom's:
Remember AACS W


B: Reflective Thinking
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Accessibility: Keyboard Navigation W




4) Real capital is composed of long-term plant and equipment.
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Answer: TRUE Diff W W


2
Copyright © 2019 McGraw-Hill Education. All rights reserved.
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No reproduction or distribution without the prior written consent of McGraw-
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Hill Education.

,iculty: 1 Easy
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Topic: Introduction to corporate finance
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Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.
Bloom's: Remember




3
Copyright © 2019 McGraw-Hill Education. All rights reserved.
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No reproduction or distribution without the prior written consent of McGraw-
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Hill Education.

, AACSB: Reflective Thinking Acce
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ssibility: Keyboard Navigation
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5) During the 1930s, financial practice revolved around such topics as the preservation of capit
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al, maintenance of liquidity, the reorganization of financially troubled corporations, and bankru
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ptcy.

Answer: TRUE Diff
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iculty: 1 Easy
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Topic: Introduction to corporate finance
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Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.
Bloom's:
Remember AACS W


B: Reflective Thinking
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Accessibility: Keyboard Navigation W




6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
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Answer: TRUE Diff
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iculty: 1 Easy
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Topic: Introduction to corporate finance
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Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.
Bloom's:
Remember AACS W


B: Reflective Thinking
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Accessibility: Keyboard Navigation W




7) Recently, the emphasis of financial management has been on the relationship between risk a
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nd return.
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Answer: TRUE Diff
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iculty: 1 Easy
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Topic: Introduction to corporate finance
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Learning Objective: 01-
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01 The field of finance integrates concepts from economics, accounting, and a number of other
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areas.; 01-
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03 The relationship of risk to return is a central focus of finance. Bloom's: Understand
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AACSB: Analytical Thinking Acce
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ssibility: Keyboard Navigation
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8) The first Nobel Prizes given to finance professors were for their contributions to capit
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al structure theory and portfolio theories of risk and return.
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4
Copyright © 2019 McGraw-Hill Education. All rights reserved.
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No reproduction or distribution without the prior written consent of McGraw-
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Hill Education.