Test Bank
Foundations Of Financial Management,
By Stanley Block, Geoffrey Hirt, Bartley Danielsen
18th edition
,Table of contents
Part 1 introduction
1 the goals and activities of financial management
Part 2 financial analysis and planning
2 review of accounting
3 financial analysis
4 financial forecasting
5 operating and financial leverage
Part 3 working capital management
6 working capital and the financing decision
7 current asset management
8 sources of short-term financing
Part 4 the capital budgeting process
9 the time value of money
10 valuation and rates of return
11 cost of capital
12 the capital budgeting decision
13 risk and capital budgeting
Part 5 long-term financing
14 capital markets
15 investment banking
16 long-term debt and lease financing
17 common and preferred stock financing
18 dividend policy and retained earnings
19 convertibles, warrants, and derivatives
Part 6 expanding the perspective of corporate finance
20 external growth through mergers
21 international financial management
,Foundations of financial management, 18e (block)
Chapter 1 the goals and activities of financial management
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
Answer: false
difficulty: 1 easy
Topic: financial management decisions
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
3) Financial capital is composed of long-term plant and equipment, as well as other tangible
investments.
Answer: false
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
4) Real capital is composed of long-term plant and equipment.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember
, Aacsb: reflective thinking
accessibility: keyboard navigation
5) During the 1930s, financial practice revolved around such topics as the preservation of capital,
maintenance of liquidity, the reorganization of financially troubled corporations, and bankruptcy.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
7) Recently, the emphasis of financial management has been on the relationship between risk and
return.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.; 01-03 the relationship of risk to return is a central focus of finance.
Bloom's: understand
Aacsb: analytical thinking
accessibility: keyboard navigation
8) The first nobel prizes given to finance professors were for their contributions to capital
structure theory and portfolio theories of risk and return.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember
Foundations Of Financial Management,
By Stanley Block, Geoffrey Hirt, Bartley Danielsen
18th edition
,Table of contents
Part 1 introduction
1 the goals and activities of financial management
Part 2 financial analysis and planning
2 review of accounting
3 financial analysis
4 financial forecasting
5 operating and financial leverage
Part 3 working capital management
6 working capital and the financing decision
7 current asset management
8 sources of short-term financing
Part 4 the capital budgeting process
9 the time value of money
10 valuation and rates of return
11 cost of capital
12 the capital budgeting decision
13 risk and capital budgeting
Part 5 long-term financing
14 capital markets
15 investment banking
16 long-term debt and lease financing
17 common and preferred stock financing
18 dividend policy and retained earnings
19 convertibles, warrants, and derivatives
Part 6 expanding the perspective of corporate finance
20 external growth through mergers
21 international financial management
,Foundations of financial management, 18e (block)
Chapter 1 the goals and activities of financial management
1) As finance emerged as a new field, much emphasis was placed on mergers and acquisitions.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
2) Inflation is assumed to be a temporary problem that does not affect financial decisions.
Answer: false
difficulty: 1 easy
Topic: financial management decisions
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
3) Financial capital is composed of long-term plant and equipment, as well as other tangible
investments.
Answer: false
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
4) Real capital is composed of long-term plant and equipment.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember
, Aacsb: reflective thinking
accessibility: keyboard navigation
5) During the 1930s, financial practice revolved around such topics as the preservation of capital,
maintenance of liquidity, the reorganization of financially troubled corporations, and bankruptcy.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
6) In the mid 1950s, finance began to change to a more analytical, decision-oriented approach.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember aacsb:
reflective thinking
Accessibility: keyboard navigation
7) Recently, the emphasis of financial management has been on the relationship between risk and
return.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.; 01-03 the relationship of risk to return is a central focus of finance.
Bloom's: understand
Aacsb: analytical thinking
accessibility: keyboard navigation
8) The first nobel prizes given to finance professors were for their contributions to capital
structure theory and portfolio theories of risk and return.
Answer: true
difficulty: 1 easy
Topic: introduction to corporate finance
Learning objective: 01-01 the field of finance integrates concepts from economics, accounting,
and a number of other areas.
Bloom's: remember
