TEST BANK
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Corporate Finance, Canadian Edition, 6th Edition
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by Jonathan Berk, Peter DeMarzo, All Chapters 1 - 31
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,TABLE OF CONTENTS w w
1. The Corporation and Financial Markets
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2. Introduction to Financial Statement Analysis w w w w
3. Financial Decision Making and the Law of One Price
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4. The Time Value of Money
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5. Interest Rates w
6. Valuing Bonds w
7. Investment Decision Rules w w
8. Fundamentals of Capital Budgeting w w w
9. Valuing Stocks w
10. Capital Markets and the Pricing of Risk
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11. Optimal Portfolio Choice and the Capital Asset Pricing Model
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12. Estimating the Cost of Capital w w w w
13. Investor Behavior and Capital Market Efficiency
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14. Capital Structure in a Perfect Market
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15. Debt and Taxes
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16. Financial Distress, Managerial Incentives, and Information
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17. Payout Policy w
18. Capital Budgeting and Valuation with Leverage
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19. Valuation and Financial Modeling: A Case Study
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20. Financial Options w
21. Option Valuation
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22. Real Options
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23. Raising Equity Capital w w
24. Debt Financing
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25. Leasing
26. Working Capital Management w w
27. Short-Term Financial Planning w w
28. Mergers and Acquisitions w w
29. Corporate Governance w
30. Risk Management
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,31. International Corporate Finance
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, 1. The Corporation and Financial Markets w w w w
1.1 The Three Types of Firms w w w w
1) A sole proprietorship is owned by:
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A) one person w
B) two or more people
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C) shareholders
D) banker
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ANSWER A w
Diff: 1 Type: MC
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Topic: 1.1 The Three Types of Firms
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2) In Canada, which of the following organization forms accounts for the greatest
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number offirms?
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A) Limited Liability Partnership w w
B) Limited Partnership w
C) Sole Proprietorship w
D) PubliclyTraded w
CorporationANSWER: C
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Diff: 1 Type: MC
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Topic: 1.1 The Three Types of Firms
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3) Which of the following organization forms earns the most revenue?
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A) Privately Owned Corporation w w
B) Limited Partnership w
C) Publicly Owned Corporation w w
D) Limited Liability w
CompanyANSWER: C
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Diff: 1 Type: MC
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Topic: 1.1 The Three Types of Firms
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4) Which of the following is NOT an advantage of a sole proprietorship?
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A) Single taxation w
B) Ease of setup w w
C) Limited liability w
D) No separation of ownership and
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controlANSWER: C
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Diff: 2 Type: MC
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w
Corporate Finance, Canadian Edition, 6th Edition
w w w w w
by Jonathan Berk, Peter DeMarzo, All Chapters 1 - 31
w w w w w w w w w w
,TABLE OF CONTENTS w w
1. The Corporation and Financial Markets
w w w w
2. Introduction to Financial Statement Analysis w w w w
3. Financial Decision Making and the Law of One Price
w w w w w w w w
4. The Time Value of Money
w w w w
5. Interest Rates w
6. Valuing Bonds w
7. Investment Decision Rules w w
8. Fundamentals of Capital Budgeting w w w
9. Valuing Stocks w
10. Capital Markets and the Pricing of Risk
w w w w w w
11. Optimal Portfolio Choice and the Capital Asset Pricing Model
w w w w w w w w
12. Estimating the Cost of Capital w w w w
13. Investor Behavior and Capital Market Efficiency
w w w w w
14. Capital Structure in a Perfect Market
w w w w w
15. Debt and Taxes
w w
16. Financial Distress, Managerial Incentives, and Information
w w w w w
17. Payout Policy w
18. Capital Budgeting and Valuation with Leverage
w w w w w
19. Valuation and Financial Modeling: A Case Study
w w w w w w
20. Financial Options w
21. Option Valuation
w
22. Real Options
w
23. Raising Equity Capital w w
24. Debt Financing
w
25. Leasing
26. Working Capital Management w w
27. Short-Term Financial Planning w w
28. Mergers and Acquisitions w w
29. Corporate Governance w
30. Risk Management
w
,31. International Corporate Finance
w w
, 1. The Corporation and Financial Markets w w w w
1.1 The Three Types of Firms w w w w
1) A sole proprietorship is owned by:
w w w w w
A) one person w
B) two or more people
w w w
C) shareholders
D) banker
s w
ANSWER A w
Diff: 1 Type: MC
w w
Topic: 1.1 The Three Types of Firms
w w w w w w
2) In Canada, which of the following organization forms accounts for the greatest
w w w w w w w w w w w
number offirms?
w w w
A) Limited Liability Partnership w w
B) Limited Partnership w
C) Sole Proprietorship w
D) PubliclyTraded w
CorporationANSWER: C
w w w
Diff: 1 Type: MC
w w
Topic: 1.1 The Three Types of Firms
w w w w w w
3) Which of the following organization forms earns the most revenue?
w w w w w w w w w
A) Privately Owned Corporation w w
B) Limited Partnership w
C) Publicly Owned Corporation w w
D) Limited Liability w
CompanyANSWER: C
w w w
Diff: 1 Type: MC
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Topic: 1.1 The Three Types of Firms
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4) Which of the following is NOT an advantage of a sole proprietorship?
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A) Single taxation w
B) Ease of setup w w
C) Limited liability w
D) No separation of ownership and
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controlANSWER: C
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Diff: 2 Type: MC
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