1) The science of finance differs from the science of accounting in that finance is more concerned with-
Historical matters than future matters
Cash accounting than with accrual accounting
Book valuation than market valuation
Balancing accounts than with analyzing relationships.
2) For a firm whose profitability is highly sensitive to the price it must pay for oil, which of the following finance functions would be most critical to stabilizing that price?
Financial Management
Capital Budgeting
Risk Management
Financing
Corporate Governance
3) Capital structure" is dictated by the financial manager acting in the capacity of-
Financial manager
capital budgeter
risk manager
corporate governance
financing manager
4) American banks act as financial intermediaries in that they purchase and sell the equity and debt securities of public and private corporations.
True
False
5) Limited liability may be achieved by structuring our business as a "Limited Liability Corporation"
True
False
6) From the point of view of the course text, managing a corporation primarily for the benefit of stakeholders constitutes- the only socially acceptable mode of management mismanagement of a fundamental conflict of interest
The best way to benefit shareholders the generally preferred management objective for managers of American corporations
7) treasury stock voting rights-
may be exercised by the corporation in electing the Board of Directors
may be exercised by the corporation, but not in electing the Board of Directors
are suspended until such time as those shares are resold to the public
are permanently removed from the associated shares
8) Financial managers focus on-
current and projected cash flow
economically based accruals
generally accepted accounting principles