TEST BANK FOR Corporate Finance 13th Edition by Stephen A. Ross, Randolph W. Westerfield, Jeffrey Jaffe & Bradford D. Jordan , ISBN: 9781260772388 Chapters 1-31|All Chapters Verified| Guide A+

TEST BANK
Corporate Finance
Stephen A. Ross, Randolph W. Westerfield, Jeffrey Jaffe, Bradford D. Jordan

13th Edition
Chapters 1-31
PR
O
FD
O
C

,@PROFDOCDIGITALLIBRARIES




Chapter 01: Introduction to Corporate Finance
Multiple Choice Questions



1. Which one of the following terms is defined as the management of a firm's long-term
investments?
A. working capital management
B. financial allocation
C. agency cost analysis
D. capital budgeting
E. capital structure

Refer to section 1.1
PR

AACSB: N/A
Difficulty: Basic
Learning Objective: 1-1
Section: 1.1
O
Topic: Capital budgeting



2. Which one of the following terms is defined as the mixture of a firm's debt and equity
FD
financing?
A. working capital management
B. cash management
C. cost analysis
D. capital budgeting
E. capital structure
O

Refer to section 1.1
C

AACSB: N/A
Difficulty: Basic
Learning Objective: 1-1
Section: 1.1
Topic: Capital structure




1-1

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3. Which one of the following is defined as a firm's short-term assets and its short-term
liabilities?
A. working capital
B. debt
C. investment capital
D. net capital
E. capital structure

Refer to section 1.1


AACSB: N/A
Difficulty: Basic
Learning Objective: 1-1
PR
Section: 1.1
Topic: Working capital



4. A business owned by a solitary individual who has unlimited liability for its debt is called
a:
A. corporation.
O
B. sole proprietorship.
C. general partnership.
D. limited partnership.
FD
E. limited liability company.

Refer to section 1.2
O
AACSB: N/A
Difficulty: Basic
Learning Objective: 1-3
Section: 1.2
C
Topic: Sole proprietorship




1-2

, @PROFDOCDIGITALLIBRARIES




5. A business formed by two or more individuals who each have unlimited liability for all of
the firm's business debts is called a:
A. corporation.
B. sole proprietorship.
C. general partnership.
D. limited partnership.
E. limited liability company.

Refer to section 1.2


AACSB: N/A
Difficulty: Basic
Learning Objective: 1-3
PR
Section: 1.2
Topic: General partnership



6. A business partner whose potential financial loss in the partnership will not exceed his or
her investment in that partnership is called a:
A. generally partner.
O
B. sole proprietor.
C. limited partner.
D. corporate shareholder.
FD
E. zero partner.

Refer to section 1.2
O
AACSB: N/A
Difficulty: Basic
Learning Objective: 1-3
Section: 1.2
C
Topic: Limited partner




1-3